I Have A Qualified Variable Annuity. What Is That Exactly? 
You have a qualified variable annuity ? The `` qualified '' part means all monies contributed into this product are done so on a pre tax basis . An `` Annuity '' is a product that can be sold inside a qualified plan or outside . The difference between the two are the tax deferral on the original money you put inside it . Inside a qualified plan , you get a tax break on the money you put in . Non qualified means you pay taxes on the money you put in first . Later , during distribution a portion of the payout will be taxable income and a portion wo n't as you already paid taxes on it . Variable means the annuity , usually based in security products , will gain OR lose based on the investment decision the purchaser makes by their allocations and their market performance . Variable means more risk for the possibility of greater return basically . 