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QLAC stands for Qualified Longevity Annuity Contract. It is a deferred income annuity purchased with eligible qualified retirement funds and designed to begin guaranteed income later in retirement, no later than age 85. Because the funds remain inside the tax-deferred retirement arrangement until payments begin, that portion of the retirement savings can stay tax-deferred longer; taxes are generally due when income is paid.

RMD stands for Required Minimum Distribution. It is the minimum amount federal tax rules generally require an owner to withdraw each year from traditional IRAs and many employer retirement plans after reaching the applicable starting age. The withdrawal is not a fee: the money belongs to the account owner, but pre-tax amounts generally become taxable income when distributed.

Qualified funds are retirement assets held under tax-favored federal rules, usually with income tax deferred until distribution. QLAC-eligible sources can include traditional, SEP, and SIMPLE IRAs and eligible 401(a), 401(k), 403(a), 403(b), and governmental 457(b) defined-contribution plans. An employer plan must permit the purchase or transfer. Roth IRAs do not qualify, and inherited-account or plan-specific situations require individual review.

Federal QLAC status comes primarily from Internal Revenue Code section 401(a)(9), Treasury Regulation section 1.401(a)(9)-6(q), and SECURE 2.0 Act section 202. Issuer reporting is addressed under Treasury Regulation section 1.6047-2 and Form 1098-Q. In California, annuity sales also fall under the Insurance Code, including the best-interest duties in sections 10509.9200 through 10509.9210, licensing and training rules, and applicable senior free-look protections.

QLACs may be funded from eligible pre-tax retirement accounts, including traditional IRAs and certain employer plans that offer the option. Roth IRAs are not eligible. A direct trustee-to-trustee transfer is generally not treated as a current taxable distribution.

For 2026, the lifetime premium limit across all of your QLACs is $210,000. The former 25% account-balance limit has been removed. Limits and eligibility can change, so current IRS rules should be confirmed before purchase.

Payments must start no later than age 85, although many contracts allow an earlier date. The later the start date, the larger the income may be, all else equal.

Possibly, when the contract permits it. For example, the current IncomeSource Select product summary says the selected income date may be moved by up to 60 months during the deferral period. It generally allows up to two changes to the income date or payment frequency; a move between 30 and 60 months uses both changes, 60 days’ advance notice is required, and other timing restrictions apply. Moving the date begins scheduled income sooner—it does not provide a withdrawal, surrender, or lump-sum access to the premium. Features vary by insurer, state, and contract.

Contract choices matter. Some QLACs offer a return-of-premium death benefit or survivor income; those protections generally reduce the income amount. The exact tradeoffs appear in the carrier illustration and contract.

A standard QLAC generally does not provide early access for these events. Western & Southern states that its QLAC has no cash value, cannot be surrendered, and gives the owner no access to the premium after the applicable cancellation period. Some non-QLAC annuities or separate insurance policies may offer living-benefit or long-term-care features, so the exact contract type matters.

No. A QLAC can create income that may be used for any expense after scheduled payments begin, including care, but it does not reimburse long-term-care costs or unlock the premium when care is needed. A separate needs analysis can determine whether longevity income and long-term-care protection should complement each other.

The federal Administration for Community Living estimates that someone turning 65 has almost a 70% chance of needing some type of long-term services and supports during their remaining lifetime, and 20% will need support for longer than five years. An HHS/ASPE analysis using a narrower definition projects that more than half of older adults will develop serious LTSS needs and about 37% will receive nursing-home care after age 65. These are population estimates, not predictions for one person.

CareScout's 2025 statewide median estimates for California were $91,520 per year for 44 hours a week of non-medical in-home care, $82,800 per year for a private one-bedroom residential care setting, $146,000 per year for a semi-private nursing-home room, and $182,135 per year for a private nursing-home room. Actual costs vary by location, provider, services, and level of support.

A care-funding plan can make it easier to pay for professional help, respite care, transportation, and other support instead of expecting relatives to absorb every hour and expense. Family caregiving can be deeply meaningful, but national research also documents physical, emotional, workplace, and financial strain. Planning ahead can preserve choices, relationships, retirement savings, and caregivers' own health.

Not in the way a savings account or CD does. Eligible retirement funds are already tax-deferred, and a QLAC continues that deferral until income is paid; it does not create tax-free earnings or an accessible account balance. The contract instead specifies guaranteed future income based on factors such as premium, age, start date, and payout option.

No. Investments with changing returns can finish above or below a steady return. However, volatility creates compounding drag: if two return paths have the same arithmetic average, the steadier path can finish with more money. A QLAC should not be described as an account earning a guaranteed investment return. Its value is a contractually guaranteed future income amount and protection against living longer than expected, in exchange for liquidity and market upside.

Yes, when a life-contingent payout option is selected, payments continue for as long as the covered annuitant lives. A joint-life option can continue for a spouse. Guarantees depend on the issuing insurer’s claims-paying ability, and death-benefit choices can change the payment amount.

Payments funded with pre-tax qualified money are generally taxed as ordinary income when received. Taxes are deferred, not eliminated. This website does not provide tax or legal advice; coordinate with a qualified tax professional.

Start with the exact legal issuer, its California authorization and NAIC number, several current financial-strength ratings and their outlooks, operating history, statutory financial statements, and complaint record. Ratings are opinions, can change, and are not guarantees. The contract promise depends on the issuing insurer's claims-paying ability, not a bank or the FDIC.

Companies that currently issue or have issued QLACs include Western & Southern through Integrity Life, MassMutual, Lincoln Financial, Pacific Life, New York Life, Guardian Life, Brighthouse Financial, and United of Omaha. Michael has direct or brokerage-facilitated carrier relationships involving Integrity Life, Guardian, MassMutual, New York Life, United of Omaha, and Pacific Life. A carrier relationship does not guarantee that a particular QLAC is currently approved, available, or authorized for sale in California. Those facts are confirmed before quoting or recommending a contract.