Making Your Tax Bracket Work Have you explored all your options when it comes to managing your taxable income? Share | Related Content What Is a 1035 Exchange? 1035 exchanges provide a way to trade-in an annuity contract or life insurance policy without triggering a tax liability. How Income Taxes Work A quick look at how federal income taxes work. You May Need to Make Estimated Tax Payments If… Have income that isn’t subject to tax withholding? Or insufficient withholdings? You may have to pay estimated taxes.