ENDORSEMENT
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INDIVIDUAL RETIREMENT ANNUITY PROVISIONS
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INDIVIDUAL RETIREMENT ANNUITY ENDORSEMENT
This Contract is established as an Individual Retirement Annuity ("IRA") as
defined in Section 408 of the Internal Revenue Code of 1986, as amended (the
"Code") or any successor provision pursuant to the Owner's request in the
Application. Accordingly, this endorsement is attached to and made part of the
Contract as of its Issue Date or, if later, the date shown below.
Notwithstanding any other provisions of the Contract to the contrary, the
following provisions shall apply.
RESTRICTIONS ON INDIVIDUAL RETIREMENT ANNUITY
To ensure treatment as an IRA, this Contract will be subject to the requirements
of Code Section 408, which are briefly summarized below.
1. The Contract is established for the exclusive benefit of the Owner or his
or her beneficiaries. The Owner shall be the Annuitant.
2. The Contract shall be nontransferable and the entire interest of the Owner
in the Contract is nonforfeitable.
3. Notwithstanding any provision of the Contract to the contrary, the
distribution of the Owner's interest shall be made in accordance with the
minimum distribution requirements of Section 401(a)(9) of the Internal
Revenue Code and the regulations thereunder, including the incidental death
benefit provisions of Section 1.401(a)(9)-2 of the proposed regulations.
The Owner's entire interest in the Contract must be distributed, or begin
to be distributed, by the Owner's required beginning date, which is the
April 1 following the calendar year in which the Owner reaches age 70 1/2.
For each succeeding year, a distribution must be made on or before December
31. By the required beginning date, the Owner may elect to have the balance
in the account distributed in one of the following forms:
1) A single lump sum payment;
2) Equal or substantially equal monthly, quarterly, or annual payments
over the life of the Owner or over the joint and last survivor lives
of the Owner and his or her Designated Beneficiary; or
3) Equal or substantially equal annual payments over a specified period
that may not be longer than the Owner's life expectancy or the joint
and last survivor life expectancy of the Owner and his or her
Designated Beneficiary.
An Annuity Option may not be elected with a Fixed Period that will guarantee
Annuity Payments beyond the life expectancy of the Annuitant and Beneficiary and
Annuity Payments must be made at least annually and in equal amounts.
4. If the Owner dies before his or her entire interest is distributed, the
entire remaining interest will be distributed as follows:
a. If the Owner dies on or after distributions have begun under Section 3,
the entire remaining interest must be distributed at least as rapidly
as provided under Section 3.
FSB203 (R2-97) SP020331
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INDIVIDUAL RETIREMENT ANNUITY PROVISIONS (Continued)
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RESTRICTIONS ON INDIVIDUAL RETIREMENT ANNUITY (Continued)
b. If the Owner dies before distributions have begun under Section 3, the
entire remaining interest must be distributed as elected by the Owner
or, if the Owner has not so elected, as elected by the Designated
Beneficiary or Beneficiaries as follows:
1) by December 31 of the year containing the fifth anniversary of the
Owner's death; or
2) in equal or substantially equal payments over the life or life
expectancy of the Designated Beneficiary or Beneficiaries starting by
December 31 of the year following the year of the Owner's death. If,
however, the Designated Beneficiary is the Owner's surviving spouse,
then this Distribution is not required to begin until December 31 of
the later of: (1) the calendar year immediately following the
calendar year in which the Owner died; or (2) the calendar year in
which the Owner would have attained age 70 1/2.
5. An individual may satisfy the minimum distribution requirements under
Section 401(a)(9) of the Code by receiving a distribution from one IRA that
is equal to the amount required to satisfy the minimum distribution
requirements for two or more IRAs. For this purpose, the Owner of two or
more IRAs may use the "alternative method" described in Notice 88-38,
1988-1 C.B. 524, to satisfy the minimum distribution requirements described
above.
6. Any refund of premiums (other than those attributable to excess
contributions) will be applied before the close of the calendar year
following the year of the refund toward the payment of future premiums or
the purchase of additional benefits.
7. The annual premium shall not exceed the lesser of $2,000 or 100 percent of
compensation ($4,000 or 100 percent of compensation for Spousal IRAs
however, no more than $2,000 can be contributed to either spouse's IRA),
except for plans defined in Section 408(k) of the Code, for which annual
premiums shall not exceed $30,000.
8. Rollover contributions from other qualified plans permitted by the Internal
Revenue Code Sections 402(c), 403(a)(4), 403(b)(8), and 408(d)(3), are
excluded from the limit set forth in Section 8.
9. Notwithstanding any Contract provisions to the contrary, no amount may be
borrowed under the Contract and no portion may be used as security for a
loan.
10. Annuity Payments may not begin before the Annuitant attains the age of 59
1/2 without incurring a penalty tax except in the situations described in
Section 72(t) of the Code.
FIRST SECURITY BENEFIT LIFE INSURANCE AND ANNUITY COMPANY OF NEW YORK
XXXXX X. XXXXX XXXXXX X. XXXXXX
Secretary President
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Endorsement Effective Date
(If Other Than Issue Date)
SP 020331
