Employee Benefits-IRS Announces That It Will No Longer Permit Use Of Lump Sums To Replace Life Income From A Defined Benefit Plan

In Notice 2015-49, the Internal Revenue Service (the “IRS”) announced that the Treasury Department and the IRS intend to amend the required minimum distribution regulations under § 401(a)(9) of the Internal Revenue Code to address the use of lump sum payments to replace annuity payments being paid by a qualified defined benefit pension plan. The IRS said the the regulations, as amended, will provide that qualified defined benefit plans generally are not permitted to replace any joint and survivor, single life, or other annuity currently being paid with a lump sum payment or other accelerated form of distribution. The Treasury Department and the IRS intend that these amendments to the regulations will apply as of July 9, 2015, except with respect to certain accelerations of annuity payments described in the Notice.