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A Guide to QLACs - The New 401(k) Plan Annuity Option

More than two years after soliciting comments, the Treasury Department issued final regulations making available the opportunity for retirement plan participants to purchase Qualified Longevity Annuity Contracts (QLACs) inside retirement plans. The goal of these new products is to enable employees to hedge the risk of outliving their retirement account balances through the purchase of a fixed, deferred annuity contract that could begin making payments to annuitants as late as age 85. These rules are effective for any contracts purchased after July 2, 2014.

Some of the key provisions necessary for an annuity to qualify as a QLAC under the regulations include:


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