Reprinted with permission from Employee Benefit Review -
November 2014
An ongoing focus for the IRS and the DOL has been trying to
ensure that individuals have a regular stream of income for the
duration of their lives. In connection with this goal, in July
of this year, the IRS released final regulations that allow for the
purchase of certain qualifying longevity annuity contracts
("QLACs") with pre-tax amounts in a defined contribution
plan under Section 401(a) of the Code, an individual retirement
annuity or account (IRA), a Section 403(b) of the Code plan or an
eligible deferred compensation plan under Section 457 of the
Code. (At this time, the final regulations do not directly
address the use of such contracts in defined benefit plans, however
in the preamble the IRS has requested comments regarding allowing
an employee to elect a QLAC structure under a such a
plan.) These final rules provide an exception to the required
minimum distribution provisions in the
