2025 Qualified Pre-Retirement Survivor Annuity (QPSA): Benefits & Key Details

Julia Kagan is a financial and consumer journalist, formerly senior editor for personal finance at Investopedia.

What Is a Qualified Pre-Retirement Survivor Annuity (QPSA)?

A Qualified Pre-Retirement Survivor Annuity (QPSA) is a crucial death benefit designed to provide financial protection to the surviving spouse of an employee who passes away before retirement. This annuity compensates the spouse for the retirement benefits that the employee would have received, ensuring ongoing financial security. Importantly, QPSAs are applicable only within qualified retirement plans.

Key Insights

• QPSA offers ongoing monetary payments to the surviving spouse of a deceased employee.
• Eligibility requires that the employee was covered under a qualified retirement plan.
• Payment calculations are governed by the Employee Retirement Income Security Act (ERISA).
• Special rules apply for survivor benefits when beneficiaries are non-spouses.
• Retirement plans offering QPSA must provide formal notification to participants.

Understanding the Mechanics of QPSA

QPSA ensures that employees can safeguard their spouse or designated beneficiary by providing a lifetime income stream if they die before retirement benefits commence. This benefit is mandatory for vested participants in various qualified plans, including defined-benefit and money purchase plans.

ERISA outlines the formula and process for calculating QPSA payments. Both the employee and spouse must consent to any waiver of these benefits, with signatures witnessed by a notary public or authorized plan official.

In certain cases, a Qualified Domestic Relations Order (QDRO) is required. This legal order directs retirement plans to allocate payments for child support, alimony, or property rights to a spouse, child, or dependent.

According to the IRS, a QPSA is a form of death benefit paid as a life annuity—typically monthly payments for life—to the surviving spouse or eligible former spouse, child, or dependent as defined under a QDRO, subject to specific qualification criteria.

Quick Fact

QPSA guarantees monthly lifetime payments, providing essential financial protection to surviving spouses.

Important Considerations for QPSA

To qualify for QPSA payments, the participant must have vested benefits and must have died prior to retirement. Additionally, the surviving spouse must have been married to the participant for at least one year.

Certain qualified plans, such as defined-contribution plans without a life annuity option or those requiring full lump-sum payments to the surviving spouse, may be exempt from offering QPSA.

Plans must notify participants about QPSA availability between ages 32 and 35, or within one year of plan entry if the participant is older than 35.

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