Best Annuity for Chiropractors Exiting Practice (2026)
TL;DR: Solo chiropractors typically sell a practice for $200K-$1.5M (lower goodwill multiples than dentists) and have a SEP-IRA stack from 15-25 years of self-employed contributions. The SEP rolls into a MYGA ladder. The practice proceeds, depending on size, go into either a §453 installment or all-cash with MYGA placement. Combined, the proceeds + SEP form a coordinated income plan for the next 25-30 years.
CD vs MYGA, after tax
What $100,000 earns in 5 years: CD vs MYGA, after tax
Rates used: CD 5.00%, the top nationally available 5-year CD (Bankrate, October 14, 2026); change it to the rate you are offered. MYGA 5.95%, the best A-rated rate we track as of October 13, 2026: Delaware Life Pinnacle Plus 5-year (AM Best A-, negative outlook, 7/31/2026), $100,000 and up, effective October 6, 2026 (Delaware Life rate sheet).
| CD, interest taxed every year | $121,081 |
|---|---|
| MYGA, tax-deferred, before tax | $133,507 |
| MYGA after paying tax on all the interest at withdrawal | $126,136 |
| Tax deferral alone adds about | $674 |
| MYGA ahead of the CD, after tax | $5,055 |
Assumes 22% federal and 0% state income tax, no withdrawals, rates held for the whole term. MYGA interest is taxed as ordinary income when you withdraw it, not as capital gains. Gains taken before age 59 1/2 can owe a 10% IRS penalty, and cashing out early can cost a surrender charge. In an IRA both grow tax-deferred, so the edge there is the rate alone. Bank and credit union deposits are FDIC or NCUA insured up to the limits; a MYGA is backed by the issuing insurer's claims-paying ability and your state's guaranty association up to its limits, not the FDIC. General education, not tax, legal or financial advice.
Why your situation is different
Chiropractic practice sales differ from dental in a few ways:
- Goodwill multiples are lower: a typical sale is 40-65% of trailing revenue for chiro vs 65-85% for dental
- Practices are more often referral-dependent on the doctor's personal brand, which makes successor transition harder
- Equipment is less expensive and depreciates faster, so the practice sale ends up more goodwill-weighted (capital gain) than dental
- Many chiros have a SEP-IRA rather than a 401(k)/cash-balance combo, because SEP is simpler for solo
For retirement planning: the SEP-IRA is usually the bigger of the two assets at retirement (sometimes $500K-$1.5M after 20+ years), and the practice sale is the supplementary lump sum.
The SEP-IRA rollover playbook
A SEP-IRA is mechanically an IRA. At retirement (or any time after age 59½), distributions are taxed as ordinary income. There's nothing to roll. It's already an IRA. But you can:
- Open a separate "annuity IRA" and transfer a portion (e.g., the MYGA bucket) to keep accounting clean
- Move from the SEP custodian to an annuity carrier's IRA wrapper
- Convert pieces to Roth in low-income years
The SEP is usually held at a brokerage (Fidelity, Schwab, etc.). Moving to a carrier is a trustee-to-trustee transfer, with no tax. Don't take possession of the funds; do the transfer carrier-to-carrier.
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Practice sale structures for chiropractors
Sale to a corporate consolidator
Increasingly common. Chiro consolidators (DSO equivalents) offer cash + earnout + sometimes equity rollover. Tax treatment depends on the structure of the deal. It is often a mix of capital gain on goodwill, ordinary on equipment, and ordinary on the earnout/employment component.
Sale to a junior associate or partner
Often involves seller financing because banks won't fully fund a chiro practice purchase on goodwill. The §453 installment sale becomes natural in this structure.
Wind-down (rare but real)
Some chiros with declining practices wind down without a sale, selling equipment for salvage and transferring patients to a colleague for a referral fee. No big lump sum, but no tax event either. Retirement is funded entirely by the SEP rollover.
Top 3 MYGA carriers writing for chiropractor rollovers in 2026
- Athene: AM Best A+. Top-of-shelf 5-10 year rates.
- Corebridge: AM Best A. Strong 5 and 7 year products.
- American National: AM Best A. Palladium MYG series. Good for $250K-$500K range, which fits most chiro rollover sizes.
Common mistakes chiropractors make at exit
- Setting an unrealistic sale price. Chiro practice multiples are lower than dental. Get a written valuation from an independent (not a broker who profits on price).
- Doing the entire SEP rollover into a single MYGA on a single day. Phase it across 60-90 days; rates move and carriers run promotions.
- Not converting any SEP to Roth in low-income transition years. The 1-3 years between active practice income and SS often have the lowest tax bracket you'll see. Convert aggressively then.
- Forgetting that the SEP allowed an above-the-line contribution every year you were active. If you missed years where you should have contributed, that's lost compounding; if you contributed at the max consistently, you have more dollars than you realize.
- Buying a variable annuity sold by an investment-advisory firm during the rollover. 2-3% fees inside a tax-deferred account is usually a worse outcome than holding low-cost index funds or MYGAs.
Worked example: $600K SEP-IRA + $400K practice sale, age 60
Dr. Kim, 60, solo chiropractor for 28 years. SEP-IRA balance: $600K. Practice sale: $400K to a junior chiropractor on 6 year installment terms ($66.6K/year). Plans to take SS at 67.
| Bucket | Vehicle | Amount | Purpose |
|---|---|---|---|
| 1. Liquidity | HYSA | $30,000 | Cushion |
| 2. 5 yr MYGA, A-rated | SEP IRA | $200,000 | 5.75% locked to 65 |
| 3. 7 yr MYGA, A-rated | SEP IRA | $200,000 | 5.90% locked to 67 |
| 4. Growth | SEP IRA, index funds | $200,000 | 20+ year horizon |
| 5. Installment payments | Non-qual MYGAs, year by year | $66.6K/yr | Reinvest each year |
Year-1 MYGA interest in SEP: ~$11,650. Year-1 installment: $66.6K, of which approximately $50K is gain (capital + ordinary). Tax bill manageable. By year 7, he has 6 layered non-qual MYGAs alongside the SEP MYGA ladder.
Related reading
- Best annuity for dentists selling practice
- Best annuity for small business owner exit
- Best annuity for real estate agents
- How much does a $1 million annuity pay per month?
- Non-qualified annuity tax explained
Frequently Asked Questions
Can I keep contributing to my SEP after I sell the practice?
Only if you have self-employment income. If you're retired with no SE income, no new SEP contributions. You can still roll, convert, and distribute.
What if I sell to a corporate consolidator with an equity-rollover component?
The cash portion is taxed at sale (capital gain on goodwill, ordinary on equipment recapture, earnout often ordinary). The rolled equity has a future tax event when you finally exit the corporate parent's stock.
Should I convert some SEP to Roth before claiming SS?
Often yes. The years between active practice income and SS claim are usually low-bracket. Convert enough each year to top off the 22 or 24 percent bracket. Cuts future RMDs and IRMAA exposure.
Can I use a 1035 exchange to swap a MYGA inside my SEP-IRA?
Section 1035 applies to non-qualified annuities. Inside an IRA, the same effect is achieved via trustee-to-trustee transfer (no tax). Use the IRA transfer mechanism, not 1035, inside an IRA.
What if my SEP is in a brokerage and I want the annuity at an insurance carrier?
Trustee-to-trustee transfer. Fill out the carrier's IRA application and they'll initiate the pull from the brokerage. Takes 2-4 weeks typically.
Are MYGA rates higher inside an IRA or outside?
Same. The carrier's rate is the carrier's rate. The difference is in the tax wrapper (deferred until distribution either way for IRA; interest accumulates tax-deferred for non-qualified).
How long does it take to close a chiropractic practice sale?
Typically 60-120 days from LOI to closing. Coordinate the MYGA placement with the actual cash-in-hand date, not the LOI date.
Should I keep practice real estate or sell it with the practice?
Often better to keep, lease back to the buyer, and sell the real estate separately later under §1031 if applicable. Real estate and practice are different assets with different tax treatments.
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Disclosure
This article reflects publicly available product materials and approximate rates as of the date stated above. Annuity rates, caps, participation rates, payout factors, crediting methods, and tax rules change frequently. Confirm current figures in the latest carrier disclosure and the contract before you buy. This article is general information for educational purposes; it is not a personalized recommendation, solicitation, or offer of any specific product, nor is it tax or legal advice. Hans Goldstein is an independent licensed insurance producer (NPN 20602398) appointed with multiple A-rated carriers across the annuity and long-term care insurance market; specific appointment status with any carrier discussed may vary, and discussion of a carrier is not an endorsement or representation of carrier appointment. No compensation has been received from any carrier in connection with the publication of this article. Always read the actual contract and consult a licensed advisor and a CPA or tax attorney before purchasing any annuity or making rollover decisions. Annuities are long-term contracts with surrender charges; they are not suitable for funds you may need before the end of the surrender period. AM Best ratings, payout factors, and tax treatment are subject to change. References to the TSP, FERS, CSRS, OPM, USPS, Social Security, IRMAA, WEP/GPO, IRC §72, §453, and §1035 reflect rules as of 2026 and are subject to change.