### Question
Can you define what required annual payment means?


### Answer
**Required annual payment** is defined as the following in *26 U.S.C. § 430*:

> the lesser of—


(I) 90 percent of the minimum required contribution (determined without regard to this subsection) to the plan for the plan year under this section, or


(II) 100 percent of the minimum required contribution (determined without regard to this subsection or to any waiver under section 412(c)) to the plan for the preceding plan year

#### Citation:
  - *26 U.S.C. § 430*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter D-Deferred Compensation, Etc. > PART III-RULES RELATING TO MINIMUM FUNDING STANDARDS AND BENEFIT LIMITATIONS > Subpart A-Minimum Funding Standards for Pension Plans**

