In this work we introduce PAINTOR (Probabilistic Annotation INTegratOR), a framework to combine external functional annotations (sets of variants that localize within certain genomic features, e.g. enhancers, repressors) with genetic association data (the strength of association between genetic variants and the phenotype) to improve the prioritization of causal variants in fine-mapping studies. As compared to existing approaches that only rely on the strength of association between genotype and phenotype [31], [5], [6], our framework combines two orthogonal lines of evidence to estimate variant-specific probabilities for causality: functional relevance and genotype-phenotype association. These probabilities can then be used for prioritization of variants for functional validation studies to determine biological causality. More specifically, we incorporate the external functional annotation data through an Empirical Bayes prior [32] with parameters inferred from targeted fine-mapping data, obviating the need to make assumptions on which tissue-specific annotation is relevant to the trait of interest. Finally, budgetary constraints will invariably restrict the number of potential variants that can be validated in functional studies. We address this issue by proposing a cost-to-benefit optimization framework to guide the design of experimental follow-up studies.