Instructions For Form 1098-Q - Qualifying Longevity Annuity Contract Information - 2017

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2017
Department of the Treasury
Internal Revenue Service
Instructions for Form 1098-Q
Qualifying Longevity Annuity Contract Information
Section references are to the Internal Revenue Code unless
When the contract is issued, the contract (or a rider or
otherwise noted.
endorsement with respect to that contract) states that the
contract is intended to be a QLAC.
Future Developments
The contract is not a variable contract under section 817,
an indexed contract, or similar contract, except to the extent
For the latest information about developments related to
provided by the Commissioner.
Form 1098-Q and its instructions, such as legislation enacted
after they were published, go to
An employee includes the owner of an IRA (other than a
Reminder
Roth IRA), where applicable.
In addition to these specific instructions, you should also use
Limitations on Premiums — Plans
the 2017 General Instructions for Certain Information
The premiums paid with respect to the contract on a date
Returns. Those general instructions include information
satisfy the limitations requirements if they do not exceed the
about the following topics.
lesser of the dollar limitation of Q&A-17(b)(2) or the
Who must file (nominee/middleman).
percentage limitation of Q&A-17(b)(3).
When and where to file.
Dollar limitation. The dollar limitation is an amount equal to
Electronic reporting requirements.
Corrected and void returns.
the excess of $125,000 over the sum of (1) the premiums
paid on the contract before that date and (2) the premiums
Statements to recipients.
paid on or before that date on any other contract intended to
Taxpayer identification numbers.
Backup withholding.
be a QLAC and that is purchased for the employee under the
plan, or any other plan, annuity, or account described in
Penalties.
section 401(a), 403(a), 403(b), or 408 or eligible
Other general topics.
governmental plan under section 457(b).
You can get the general instructions at
General
Percentage limitation. The percentage limitation is an
Instructions for Certain Information Returns
or
amount equal to the excess of 25% of the employee’s
form1098q.
account balance under the plan (including the value of any
QLAC held under the plan for the employee) as of that date
Specific Instructions
over the sum of (1) the premiums paid before that date on the
File Form 1098-Q, Qualifying Longevity Annuity Contract
contract, and (2) the premiums paid on or before that date on
Information, if you issue any contract that is intended to be a
any other contract intended to be a QLAC and that is held or
qualifying longevity annuity contract (QLAC). Prior to
was purchased for the employee under the plan.
annuitization, the value of a QLAC is excluded from the
For purposes of the dollar and percentage limitations on
account balance that is used to determine required minimum
premiums, unless the plan administrator has actual
distributions. A QLAC is an annuity contract that is purchased
knowledge to the contrary, the plan administrator may rely on
from an insurance company for an employee under any plan,
an employee’s representation, made in writing or such other
annuity, or account described in section 401(a), 403(a),
form as may be prescribed by the Commissioner, of the
403(b), or 408 (other than a Roth IRA) or eligible
amount of the premiums paid for any other contract intended
governmental plan under section 457(b), and that, in
to be a QLAC, but only with respect to premiums that are not
accordance with the rules of application of paragraph (d) of
paid under a plan, annuity, or contract that is maintained by
Regulations section 1.401(a)(9)-6, Q&A-17 (Q&A-17),
the employer or an entity that is treated as a single employer
satisfies each of the following requirements.
with the employer under section 414(b), (c), (m), or (o).
Premiums for the contract satisfy the requirements of
paragraph (b) of Q&A-17.
For purposes of the 25% limit, an employee’s account
The contract provides that distributions under the contract
balance on the date on which premiums for a contract are
must commence no later than a specified annuity starting
paid is the account balance as of the last valuation date
date that is no later than the first day of the month after the
preceding the date of the premium payment, adjusted as
employee's 85th birthday.
follows.
The contract provides that, after distributions under the
The account balance is increased for contributions
contract begin, those distributions must satisfy the
allocated to the account during the period that begins after
requirements of 1.401(a)(9)-6 (other than the requirement
the valuation date and ends before the date the premium is
that annuity payments commence on or before the required
paid.
beginning date).
The account balance is decreased for distributions made
The contract does not make available any commutation
from the account during that same period.
benefit, cash surrender right, or other similar feature.
Limitations on Premiums — IRAs
No benefits are provided under the contract after the death
of the employee other than the benefits described in
The premiums paid with respect to the contract on a date
Q&A-17(c).
satisfy the limitations requirements if they do not exceed the
Nov 03, 2016
Cat. No. 67096Y

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