As part of a busy day of government announcements related to the retirement world, the Obama Administration has given new endorsement to the use of annuities in defined benefit and defined contribution retirement plans.
The move came the same day as deadlines were delayed and final rulings issued regarding the Department of Labor's so-far often-postponed 401(k) fee disclosure regulations.
In relaxing the Application of Required Minimum Distribution rules to accommodate longevity annuities in DC plans, the Administration said it realized those rules impeded the ability to include longevity annuities in plans and traditional IRAs.
“One of the improvements offered today will exempt longevity annuities (up to a specified limit) from RMD rules to enhance the ability of 401(k) plans and IRAs to offer individuals the option to use an 'affordable' portion of their account balance to purchase a longevity annuity,” stated the White House Council.
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