QLAC Calculator (2026): How Much Guaranteed Income Will a Qualified Longevity Annuity Pay?

Most retirement calculators tell you how much money you will have. This one tells you how much guaranteed income for life a slice of your IRA can buy — and how much tax you can defer while you wait. A qualified longevity annuity contract (QLAC) lets you move up to $210,000 of pre-tax retirement money out of your required minimum distribution calculation entirely, then turn it on as a lifetime paycheck as late as age 85.

The trade is simple and severe: you give up access to the money forever, and in return you buy a floor of income that cannot be outlived. Use the calculator below to see the payout, the RMD reduction, the tax savings, and the age you would need to reach to come out ahead on pure dollars.

What Is a Qualified Longevity Annuity Contract (QLAC)?

A QLAC is a fixed deferred income annuity purchased with qualified retirement money. You pay a single premium today. The insurer holds it, invests it, and then pays you a fixed monthly amount starting on a date you choose — no later than the first day of the month after your 85th birthday.

Two IRS rules make the product useful. First, the premium is excluded from the account balance used to calculate your required minimum distributions, for every year until income begins. Second, income payments are taxed as ordinary income when received, just like any other IRA withdrawal. There is no cash value, no surrender option, and no market exposure.

Because the deferral period can run 10, 15 or even 20 years, the annual payout rate is far higher than an immediate annuity bought at the same age. A 65-year-old who starts income at 85 is collecting roughly three times the income of an identical contract turned on immediately. That is the entire point of the design.

QLAC Rules for 2026: The $210,000 Limit and the Age 85 Deadline

Two decades of the old rule are widely repeated online: the premium used to be capped at the lesser of $125,000 or 25% of your account balance, and income could not be deferred past age 72. SECURE 2.0 deleted the percentage cap, raised the dollar limit to $200,000 and indexed it. Deferring to 85 was not possible before 2023. Anyone still quoting $125,000 and age 72 is working from a superseded rulebook.

How This QLAC Calculator Works

The calculator combines three engines. The first prices your guaranteed income from an age- and sex-based payout table built on SSA 2023 period-life-table survival with a 2.5% net pricing basis — the same life table the SSA publishes each year. The second computes your RMD reduction year by year using the IRS Uniform Lifetime Table divisors, and multiplies it by your marginal bracket to get the tax you avoid. The third runs your premium forward at your assumed portfolio return to find your break-even age: the age at which the income you have collected catches the value you gave up.

All numbers are illustrative and internally consistent. Actual QLAC quotes vary by carrier, state and the interest-rate environment at the time you buy, so treat the output as a planning range, not a quote. When you are ready for a real number, compare quotes from licensed carriers.

QLAC Payout Rates by Income Start Age

The single biggest lever on your income is the length of the deferral. Below, a 65-year-old buyer pays the full $210,000 premium and chooses when income begins. These figures come from the same payout table the calculator uses, so what you see here is exactly what the tool produces for that profile.

Two things jump out. First, deferring from 80 to 85 nearly doubles the male payout on the same premium — the insurer holds the money five more years and expects to pay it out over a shorter window, and both forces push the rate up. Second, women receive less per year because they live longer, which is the same reason women pay less for life insurance. The gap narrows the further income is deferred, but it never closes.

How Much Does a QLAC Reduce Your Required Minimum Distribution?

This is the quiet benefit people miss. The QLAC premium leaves your year-end account balance, so every RMD before income begins is computed on a smaller number. At age 73 the IRS Uniform Lifetime Table divisor is 26.5, so each $1 of premium removed from the balance removes about 3.8 cents of forced income that year. The table below shows a $1,000,000 IRA in a 24% bracket.

A full $210,000 QLAC cuts that first RMD by about $7,925 and the tax bill by roughly $1,900 — and the reduction repeats every single year until income starts. Over a decade of deferral the cumulative tax saved runs into the tens of thousands, which is real money that compounds inside the IRA instead of leaving as tax. Note that this is deferral, not forgiveness: the QLAC income is taxable when it arrives.

QLAC vs. Keeping the Money Invested

Here is the honest comparison. A 65-year-old pays $210,000 into a QLAC that starts paying at 85, and we grow the same $210,000 at 5% on the other side. The question is not which number is bigger at any single age — it is whether you collect more than you gave up, and when.

Cumulative QLAC income passes the $557,193 the premium would have been worth at age 85 somewhere around age 90 — and passes the growing invested balance by age 95. Before 85 the QLAC has paid nothing at all, which is the whole risk of the product: die at 84 without a return-of-premium rider and the premium is gone. That is why the death-benefit choice matters, and why a QLAC should never be the only place your retirement money lives.

QLAC vs. SPIA, DIA, and Roth Conversions

If your problem is too much taxable income later, a Roth conversion attacks it permanently, and a QLAC defers it. If your problem is outliving your money, only the QLAC and the other annuities solve it, because only they pool longevity risk with other buyers. Many planners run both: convert in low-bracket years, then place a slice of the remaining pre-tax balance in a QLAC to build the income floor. Read our annuity vs. life insurance calculator for the other half of that decision.

Watch: How a QLAC Delays RMDs and Builds Late-Life Income

Prefer a walkthrough? This short explainer covers the RMD deferral and the age-85 income start in plain language.

Who Should Consider a QLAC

• Retirees with large pre-tax balances who do not need the full RMD every year and dislike paying tax on forced withdrawals.
• People with a strong family history of longevity — if your parents reached their nineties, the longevity credits a QLAC buys are working in your favor.
• Anyone worried about running out of money rather than about dying early, and who wants a guaranteed income floor beneath their essential expenses.
• Pre-retirees who already have enough saved to spend freely, and want to stop hoarding out of fear — a QLAC converts some savings into an income guarantee so the rest can be spent with confidence.
• Couples in high tax brackets who want to shave RMDs now and are comfortable with one spouse locking up a slice of qualified money.

Key Takeaways

• The 2026 QLAC premium limit is $210,000 per person (IRS Notice 2025-67) — a lifetime cap, not an annual one.
• Income may be deferred to the month after age 85, and the later you start, the higher the guaranteed payment.
• The premium is excluded from your RMD balance until income begins, which lowers forced income and the tax on it every year.
• A QLAC has no cash value and no surrender, so the break-even age is often the late 80s or 90s — it is insurance, not an investment.
• Always weigh the return-of-premium death benefit: it protects your heirs if you die during deferral, but it lowers your monthly income.

How to Set Up a QLAC in Six Steps

1. Confirm your RMD age. If you were born in 1959 or earlier your RMD age is 73; born in 1960 or later it is 75. The deferral benefit is biggest for people who are not yet in RMD phase.
2. Decide how much to lock up. Keep it well below the $210,000 cap unless you are certain you will not need the cash. Most planners suggest a single slice of the pre-tax balance, not all of it.
3. Choose your income start age. Ages 80 and 85 produce the largest payments and the longest deferral; age 75 is the middle ground if you want income sooner.
4. Pick the death benefit. Decide between life-only (highest income), return of premium (premium back to heirs), and joint and survivor (continues to your spouse).
5. Compare carrier quotes. Payouts for identical profiles vary by several percent between carriers. Ask for quotes from at least three A-rated insurers.
6. Fund it as a transfer, not a withdrawal. The purchase is completed as a direct trustee-to-trustee transfer inside your IRA so it never counts as a distribution.

Frequently Asked Questions

What is a QLAC?

It is a qualified longevity annuity contract, a fixed deferred income annuity bought inside a traditional IRA, 401(k), 403(b) or governmental 457(b). The IRS excludes the premium from your RMD calculation until payments begin, and you can defer income to as late as the month after your 85th birthday.

What is the 2026 QLAC premium limit?

$210,000 per person, confirmed by IRS Notice 2025-67 and unchanged from 2025. The cap applies across all QLACs you own, not per contract or per year, and each spouse has a separate $210,000 limit based on their own accounts.

When must QLAC income begin?

No later than the first day of the month after your 85th birthday. You choose an earlier date if you like; the age-85 ceiling is simply the outer limit a contract cannot exceed and still qualify as a QLAC.

Does a QLAC reduce required minimum distributions?

Yes. The premium is removed from the year-end balance used to compute each RMD until income begins. On a $1,000,000 IRA, a full $210,000 QLAC cuts the first RMD at age 73 from $37,736 to $29,811 — about $1,902 of federal tax avoided at a 24% bracket, repeating every year of the deferral.

Is a QLAC a good investment?

No — and framing it as an investment misses the point. A QLAC has no cash value and cannot be surrendered, and on pure dollars the break-even age is often the late 80s or 90s. It is longevity insurance: it converts a slice of savings into income you cannot outlive, which lets you spend the rest of your portfolio with less fear.

Can I get my money back if I die before income begins?

Only if the contract carries a return-of-premium death benefit, which pays the premium to your beneficiary if you die during deferral but reduces the monthly income. A joint and survivor option that continues payments to your spouse is also permitted. Life-only contracts pay the highest income and leave nothing behind.

Can a QLAC be funded with a Roth IRA?

No. Roth IRAs and Roth 401(k)s do not qualify, and neither do inherited IRAs or defined benefit plans. QLACs are funded only with pre-tax qualified money from a traditional IRA, 401(k), 403(b) or governmental 457(b).

Get Your Free Life Insurance Quote

A QLAC builds the income floor; life insurance protects the people who depend on you while you are building it — and a permanent policy can replace the charitable or legacy value locked inside a retirement contract. Run the numbers above, then compare free quotes from licensed carriers and see what a term or permanent policy adds to the same plan.

Related Resources

Keep exploring the retirement and estate side of coverage:

• Pension Maximization Calculator — should you take single-life and buy life insurance instead of a survivor benefit?
• Life Expectancy Calculator — how long your coverage horizon actually needs to run.
• Coverage Duration Calculator — how long a death benefit lasts as a drawn-down income account.
• Human Life Value Calculator — comparing the ways to size a policy.
• Estate Tax and ILIT Calculator — what your heirs would owe, and how an ILIT changes it.
• Medicaid Spend-Down Calculator — how retirement assets affect long-term care eligibility.
• IUL Cash Value Calculator — projecting tax-free income from a permanent policy instead of an annuity.

• IRS: Required Minimum Distributions — the official rules, including the QLAC exception.
• IRS Notice 2025-67 — the 2026 retirement plan limits, including the $210,000 QLAC premium cap.
• SEC Investor.gov: Annuities — how annuities work and the questions to ask before buying.
• NAIC Consumer Resources — how to check a carrier and understand your policyholder rights.
• AM Best Ratings — verify the financial strength of the insurer behind any annuity.