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To view or print the Microsoft Word content on this page, download the free Microsoft Word Viewer. July 15, 2003
JS-554
Treasury and IRS Issue Final Regulations for Retroactive
Annuity Payments from Pension Plans
Today, the Treasury Department and the IRS issued final regulations for defined benefit plans making retroactive annuity payments.
A defined benefit plan typically provides employees with a choice between a “qualified joint-and-survivor annuity” and other payment forms, such as a single life annuity or a lump sum. The qualified joint-and-survivor annuity provides benefits to the employee’s spouse after the employee’s death. The law requires the plan to provide the employee with certain information about the qualified joint-and-survivor annuity and the other available payment forms before the employee and the employee’s spouse choose how payments will be made. However, a company may not always be able to give the employee the information needed before the employee first becomes eligible for benefits.
The regulations allow the company to make retroactive annuity payments in those circumstances. The final regulations, which are very similar to the proposed regulations, describe how a plan can allow an employee to elect a retroactive annuity start date.
The final regulations will apply to plan years beginning on or after January 1, 2004.
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