XXXX 408(A) ENDORSEMENT
FIDELITY SECURITY LIFE INSURANCE COMPANY
0000 XXXXXXXX
XXXXXX XXXX XX 00000-2406
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The following provisions apply to a Contract which is issued as a Xxxx XXX under
Internal Revenue Code ("IRC") Section 408A. This Endorsement forms a part of the
Contract to which it is attached and is effective as of the date of the Contract
unless indicated otherwise in writing by the Company. In the case of a conflict
with any provision in the Contract, the provisions of this Endorsement will
control.
The Contract is amended as follows:
1. This Owner is the Annuitant. There shall be no Joint Owner.
2. This Contract is not transferable.
3. This Contract, and the benefits under it, cannot be sold, assigned or
pledged as collateral for a loan or as security for the performance of
an obligation or for any other purpose, or otherwise transferred to
any person other than to the Company.
4. The Owner's entire interest in this Contract is nonforfeitable.
5. The Contract is established for the exclusive benefit of the Owner and
the Owner's Beneficiary(ies).
6. Purchase Payments -
(a) Maximum permissible amount. Except in the case of a qualified
rollover contribution or a recharacterization (as defined in (e)
below), no Purchase Payment will be accepted unless it is in cash
and the total of such contributions to all the Owner's Xxxx IRAs
for a taxable year does not exceed $2,000, or the Owner's
compensation, if less, for that taxable year. The contribution
described in the previous sentence that may not exceed the lesser
of $2,000 or the Owner's compensation is referred to as a
"regular contribution". A "qualified rollover contribution" is a
rollover contribution that meets the requirements of Section
408(d)(3) of the Internal Revenue Code, except the
one-rollover-per-year rule of Section 408(d)(3)(B) does not apply
if the rollover contribution is from an IRA other than a Xxxx XXX
(a "nonRoth IRA"). Purchase Payments may be limited under (b)
through (d) below.
(b) Regular contribution limit. If (i) and/or (ii) below apply, the
maximum regular contribution that can be made to all the Owner's
Xxxx IRAs for a taxable year is the smaller amount determined
under (i) or (ii).
(i) The maximum regular contribution is phased out ratably between
certain levels of modified adjusted gross income ("modified AGI,"
defined in (f) below) in accordance with the following table:
Filing Status Full Contribution Phase-out Range No Contribution
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Modified AGI
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Single or Head $95,000 or less Between $95,000 $110,000 or
of Household and $110,000 more
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Joint Return $150,000 or less Between $150,000 $160,000 or
or Qualifying and $160,000 more
Widow(er)
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Married- $0 Between $0 $10,000 or
Separate Return and $10,000 more
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If the Owner's modified AGI for a taxable year is in the
phase-out range, the maximum regular contribution determined
under this table for that taxable year is rounded up to the next
multiple of $10 and is not reduced below $200.
(ii) If the Owner makes regular contributions to both Xxxx and nonRoth
IRAs for a taxable year, the maximum regular contribution that
can be made to all the Xxxx IRAs for that taxable year is reduced
by the regular contributions made to the nonRoth IRAs for the
taxable year.
(c) Qualified rollover contribution limit. A rollover from a nonRoth IRA
cannot be made to this IRA if, for the year the amount is distributed
from the nonRoth IRA, (i) the Owner is married and files a separate
return, (ii) the Owner is not married and has modified AGI in excess
of $100,000 or (iii) the Owner is married and together the Contract
Owner and the Owner's spouse have modified AGI in excess of $100,000.
For purposes of the preceding sentence, a husband and wife are not
treated as married for a taxable year if they have lived apart at all
times during that taxable year and file separate returns for the
taxable year.
(d) Simple IRA limits. No contributions will be accepted under a SIMPLE
IRA Plan established by any employer pursuant to Section 408(p). Also,
no transfer or rollover of funds attributable to contributions made by
a particular employer under its SIMPLE IRA Plan will be accepted from
a SIMPLE IRA, that is, an IRA used in conjunction with a SIMPLE IRA
Plan, prior to the expiration of the 2-year period beginning on the
date the Owner first participated in that employer's SIMPLE IRA Plan.
(e) Recharacterization. A regular contribution to a nonRoth IRA may be
recharacterized pursuant to the rules in Section 1.408A-5 of the
proposed regulations as a regular contribution to this IRA, subject to
the limits in (b) above.
(f) Modified AGI. For purposes of (b) and (c) above, modified AGI for a
taxable year is defined in Section 408A(c)(3)(C)(i) and does not
include any amount included in adjusted gross income as a result of a
rollover from a nonRoth IRA (a "conversion").
7. No amount is required to be distributed prior to the death of the Owner for
whose benefit the Contract was originally established.
8. Upon the death of the Owner (a) if the Owner dies on or after the Annuity
Date any remaining benefits will continue to be distributed at least as
rapidly as under the method of distribution being used prior to the Owner's
death; (b) if the Owner dies before the Annuity Date, the entire amount
payable to the Beneficiary will be distributed no later than December 31 of
the calendar year which contains the fifth anniversary of the date of the
Owner's death except to the extent that an election is made to receive
distributions in accordance with (i) (ii) or (iii) below:
(i) If any portion of the Contract proceeds is payable to a designated
Beneficiary, distributions may be made in installments over the life
or over a period not extending beyond the life expectancy of the
designated Beneficiary commencing no later than December 31 of the
calendar year immediately following the calendar year in which the
Owner died;
(ii) If the designated beneficiary is the Owner's surviving spouse, and
benefits are to be distributed in accordance with (i) above,
distributions must begin on or before the later of (a) December 31 of
the calendar year immediately following the calendar year in which the
Owner dies or (b) December 31 of the calendar year in which the Owner
would have attained age 70 1/2;
(iii)If the designated Beneficiary is the Owner's surviving spouse, the
spouse may treat the Contract as his or her own Xxxx XXX. This
election will be deemed to have been made if such surviving spouse
makes a regular contribution to the Contract, makes a rollover to or
from the Contract or fails to elect any of the above provisions.
Payments required under (I) or (ii) above must be made at intervals of no
longer than 1 year and must be either non-increasing or increasing as
provided in Q&A F-3 of Section 1.401(a)(9)-1 of the proposed regulations.
Life expectancy is computed by use of the expected return multiples in
Table V of "1.72-9 of the Income Tax Regulations. If the designated
Beneficiary is the individual's surviving spouse, then, unless otherwise
elected by the surviving spouse by the time distributions are required to
begin, the surviving spouse's life expectancy shall be recalculated
annually. Such election shall be irrevocable by the surviving spouse and
shall apply to all subsequent years. In the case of any other designated
Beneficiary, life expectancies shall be calculated using the attained age
of such Beneficiary during the calendar year in which distributions are
required to begin pursuant to (i) or (ii) above, and payments for any
subsequent calendar year shall be calculated based on such life expectancy
reduced by one for each calendar year which has elapsed since the calendar
year life expectancy was first calculated. Life expectancies shall not be
recalculated for payments made under an Annuity Option.
9. Separate records will be maintained for the interest of each Owner and the
Company will furnish annual calendar year reports concerning the status of
the Contract.
10. The Company may at its option either accept additional future payments or
terminate the Contract by a lump sum payment of the then present value of
the paid up benefit if no premiums have been received for two full
consecutive Contract Years and the paid up annuity benefit at maturity
would be less than $20 per month.
All other terms and conditions of the Contract remain unchanged
Fidelity Security Life Insurance Company has caused this Endorsement to be
signed by its President and Secretary
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Secretary President
