IRS to Allow Plans to Include Deferred Annuities in Target Date Funds

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Oct. 24 — The IRS added another piece to the lifetime income puzzle by releasing guidance enabling defined contribution plans to offer target date funds that include deferred annuities among their assets.
Notice 2014-66, issued Oct. 24, is part of the lifetime income project that the Treasury and Labor departments have undertaken and is designed to expand the use of income annuities in 401(k) plans.
“Treasury is working to expand the availability of retirement income options for working families. By encouraging the use of income annuities, today's guidance can help retirees protect themselves from outliving their savings,” J. Mark Iwry, Treasury Department deputy assistant secretary for retirement and health policy, said in a news release about the notice.