The American Society of Pension Professionals & Actuaries sent a letter to the Internal Revenue Service concerning its proposed changes to the rules regarding purchase of Qualifying Longevity Annuity Contracts (QLACs) under defined contribution plans.
The organization, which represents more than 8,500 retirement plan professionals, stated that it supported what the IRS was trying to do but felt the rules needed greater flexibility. ASPPA believes that demand for longevity annuity contracts and use of these products may be limited because of the narrow scope of the current proposal and the restrictions on contracts that will qualify.
It used as an example that participants may be reluctant to purchase QLACs with fixed interest rates, which will lock in the current low rates.
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