Treasury Department in July 2014 for use as a distribution option in employer-sponsored individual account plans
, QLACs can be purchased with the lesser of 25% of a participant's account balance, or $125,000.
Rather, the DOL has stated that employer fiduciaries wishing to avoid fiduciary liability should offer an investment menu in order to enable participants to "construct a portfolio with risk and return characteristics appropriate to their circumstances" [Final Regulation Regarding Participant Directed Individual Account Plans
, 57 Fed.
Next January, the DOL expects to issue notices of proposed rulemaking about the safe harbor for the selection of annuity providers for individual account plans
, as well as the inclusion of lifetime income estimates on participants' defined contribution (DC) account statements.
However, exchange-traded funds (ETFs) are beginning to attract greater attention for participant-directed individual account plans
, especially since the introduction of a new fee disclosure mandate and greater interest in ETF-based 401(k)s from big-name brokerage firms.
The DOL has issued three proposed rules to assist in the orderly and proper termination of individual account plans
, and the distribution of benefits where the plans have been abandoned by their sponsoring employers.
404a-5 which addresses fiduciary requirements for disclosure in participant-directed individual account plans
Instead, the regulations should be designed to encourage the provision of disability protection in individual account plans
through all of the methods in use today.
2006-27 if it has already terminated under the special DOL regulations governing terminating abandoned individual account plans
Effective in 2007, the PPA provides for a prohibited transaction exemption for certain investment advice to participants in individual account plans
Effective 2007, the PPA provides for a prohibited transaction exemption for certain investment advice to participants in individual account plans
The design features of voluntary individual account plans
can affect whether individuals participate in the accounts and what retirement incomes they will receive.
32) This requirement does not apply to Employee Stock Ownership Plans; individual account plans
, such as 401(k), profit-sharing, stock bonus, thrift, or savings plans; and certain grandfathered plans.