Have a Tax Question? Ask a Tax Expert
Your broker is correct. Because you have already taken the benefit there is no way to shield it or reduce the tax exposure.
Done before hand,the annuity could have been set up a number of ways to reduce the tax exposure. You can not avoid the tax altogether; but for example: it could have passed to a special needs trust to which you were the custodian and executor. You could then withdraw as you needed to and pay taxes on the amount of withdrawal.
But, since you have aleady cashed this in, there is no such opportunity.