"we just transferred all of the Gross Distribution of the Annuity from Company A to a new Annuity with company B"
No, this was not a transfer of one annuity to another. The surrender of the annuity as Company A and the purchase of the annuity at Company B were performed as entirely independent transactions. The amount in box 2a of the Form 1099-R from Company A is indeed taxable income that must be added to your AGI. The entire amount paid for the annuity at Company B is investment in the contract at Company B. The amount of time that passed between these transactions is entirely irrelevant.
"the time of the transfer of funds from Company A to Company B was within 5 business days there should not be a tax implication."
There is no such rule with regard to these transactions.
To be a transfer of one annuity to another, it would have to have been done as a so-called "1035 exchange." Such a transfer is required to have been made directly between the annuities with no funds paid to you. That did not happen.
