If you were to Borrowed against the 401k can the interest on the loan be deductable ?
Thanks again for all your help;)

Unfortunately that law was changed many years ago. On the other hand the interest you pay goes fully back into your account so you are, in effect, paying yourself.

Am new to this forum, don't know how to post a response,
THANK YOU SOOO MUCH FOR YOUR HELP!!

I guess I did it right...

Yep you did.

Investing in the annuity using a 401K loan would be a better way then taking the money out of the 401K.