Are you ready for retirement?
When you reach age 70 1/2, the U.S. Government requires that you withdraw funds from your retirement accounts (like IRAs and 401(k)s). These payments to you are called required minimum distributions, or RMDs. They are taxable each year.
If you don't need the money from your RMDs, you may be eligible for a Qualifying Longevity Annuity Contract, or QLAC
With a QLAC, you can wait on payments until as late as age 85. You won't receive money you don't need... and you can delay payment of your taxes.
What You Need
There are several requirements for a QLAC. The include but are not limited to:
- The account must be a 401(k), IRA, or similar account.
- Income payments must begin no later than the first day of the month following when the QLAC's owner turns age 85.
- Payment options can be single life only, joint life only (joint annuitants must be spouses), single life with cash refund, or joint life with cash refund (joint annuitants must be spouses).
- The QLAC's owner must have an IRA balance as of 12/31 of the previous year end to purchase a QLAC.
