Can Annuities Be Cashed In? 
Cashing out an annuity policy could incur policy surrender charges that can be punitive in the early years of the contract . If the annuity policy has cash value gain , then an ordinary income tax event will ensue . And if the annuity policy is cashed in and the policy owner is under 59 1/2 , an additional penalty will be added as well . Consult with your tax adviser before moving forward with any annuity policy surrender . 