Automatic Rollover
Definition A rollover from a cash-out distribution processed by the administrator of a qualified plan, 403(b) or 457(b) plan, without the participant’s ( and the
IRA
Individual retirement accounts include traditional IRAs, Roth IRAs, SIMPLE IRAs and SEP IRAs. Traditional and Roth IRAs are funded by the individual owner. SEP IRAs are funded by employers. SIMPLE IRAs are generally funded by employers and employees. Special tax rules apply to these accounts.
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Assumed Rate of Interest
Definition Rate of interest on which an account balance is assumed (or projected) to grow. The assumed rate of interest must be within IRS approved
Annuity Unit
Definition A unit of measure or calculation that is used to determine an annuity payment amount. Referring Cite Annuity contract, Rule 22c-1
Annuity Contract
Definition A contract between an annuitant and the issuer , the terms of which promises to pay the annuitant income. The income is usually for
Annuitization (or annuitization of payments)
Definition The act of scheduling payments in the form of an annuity, usually for a fixed amount for a fixed period or over the annuitant’s
Annuitization Method (or Fixed annuitization method)
Definition One of the methods used to calculate substantially equal periodic payments (SEPP), also referred to as 72(t) payments. Under the fixed annuitization method, the
Annuitization Phase
Definition The period during which an annuitant receives annuity payments from an annuity or other financial product. For retirement plan purposes, distributions from defined benefit
Amortization Method (or Fixed amortization method)
Definition One of the methods used to calculate substantially equal periodic payments (SEPP), also referred to as 72(t) payments. Under the fixed amortization method, the
Annuitant
Definition The person who receives annuity payouts from an annuity product. Payouts are usually based on this person’s life expectancy. Referring Cite IRS Publication 575,
Annual Benefit
Definition A benefit which is payable annually in the form of a straight life annuity under a defined benefit plan. Such benefit does not include