§ 24-7-719 — Rollover of distributions - Definitions

Arkansas § 24-7-719

• Jurisdiction: Arkansas
• Title: 24

Text

(a) As used in this section: (1) "Direct rollover" means a payment by the Arkansas Teacher Retirement System to the eligible retirement plan specified by the distributee; (2) (A) "Distributee" includes a member or former member. (B) The member's or former member's surviving spouse and the member's or former member's spouse or former spouse who is the alternate payee under a qualified domestic relations order, as defined in the Internal Revenue Code, 26 U.S.C. § 414(p) , as it existed on January 1, 2011, are distributees with regard to the interest of the spouse or former spouse; (3) (A) "Eligible retirement plan" means an eligible plan under the Internal Revenue Code, 26 U.S.C. § 457(b) , as it existed on January 1, 2011, that is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state that agrees to separately account for amounts transferred into such a plan from the Arkansas Teacher Retirement System individual retirement account described in the Internal Revenue Code, 26 U.S.C. § 408(a) , as it existed on January 1, 2011, and an individual retirement annuity described in the Internal Revenue Code, 26 U.S.C. § 408(b) , as it existed on January 1, 2011, an annuity plan described in the Internal Revenue Code, 26 U.S.C. § 403(a) , as it existed on January 1, 2011, an annuity contract described in the Internal Revenue Code, 26 U.S.C. § 403(b) , as it existed on January 1, 2011, or a qualified plan described in the Internal Revenue Code, 26 U.S.C. § 401(a) , as it existed on January 1, 2011, that accepts the distributee's eligible rollover distribution. (B) The definition of "eligible retirement plan" shall also apply in the case of distribution to a surviving spouse or to a spouse or former spouse who is the alternate payee under a qualified domestic relations order, as defined in the Internal Revenue Code, 26 U.S.C. § 414(p) , as it existed on January 1, 2011; and (4) (A) "Eligible rollover distribution" means any distribution of all or any portion of the balance to the credit of the distributee, except that an eligible rollover distribution does not include: (i) Any distribution that is one (1) of a series of substantially equal periodic payments, not less frequently than annually, made for: (a) The life or life expectancy of the distributee; (b) The joint lives or joint life expectancies of the distributee and the distributee's designated beneficiary; or (c) A specified period of ten (10) years or more; (ii) Any distribution to the extent such a distribution is required under the Internal Revenue Code, 26 U.S.C. § 401(a)(9) , as it existed on January 1, 2011; (iii) Any hardship distribution; (iv) The portion of any other distribution or distributions that are not includible in gross income; and (v) Any other distribution that is reasonably expected to total less than two hundred dollars ($200) during a year. (B) A portion of a distribution shall not fail to be an eligible rollover distribution merely because the portion consists of after-tax employee contributions that are not includible in gross income. However, such a portion may be transferred only to an individual retirement account or annuity described in the Internal Revenue Code, 26 U.S.C. § 408(a) - (b) , as it existed on January 1, 2011, or to a qualified defined contribution plan described in the Internal Revenue Code, 26 U.S.C. § 401(a) , or 26 U.S.C. § 403(a) , as it existed on January 1, 2011, that agrees to separately account for amounts so transferred, including separately accounting for the portion of the distribution that is includible in gross income and the portion of the distribution that is not so includible. (b) (1) (A) A distributee or other eligible beneficiary receiving a distribution from the system may direct to have any portion of an eligible rollover distribution that is five hundred dollars ($500) or more paid directly to an eligible retirement plan specified by the distributee in a direct rollover. (B) The distribution under subdivision (b)(1)(A) of this section may be made: (i) Despite any provision of this chapter that would otherwise limit a distributee's election under this section; and (ii) At the time and in the manner prescribed by the system. (C) The election under subdivision (b)(1)(A) of this section shall not be allowed for an eligible rollover distribution less than five hundred dollars ($500). (2) The amount under subdivision (b)(1)(A) of this section shall be paid to the trustee of the eligible retirement plan. (3) Effective July 1, 2010, an eligible rollover distribution to a beneficiary who is not the surviving spouse of a member may be directed as provided under 26 U.S.C. § 402(c)(11) to a trustee-to-trustee transfer to an individual retirement account described in 26 U.S.C. § 408(a) or to an individual retirement annuity described in 26 U.S.C. § 408(b) . (c) Subsection (b) of this section applies to distributions made under §§ 24-7-709 - 24-7-711 , § 24-7-716 [repealed], § 24-7-720 , and § 24-7-1308 . (d) This section does not require the system to authorize a direct rollover of a distribution if: (1) The distribution is not eligible to be treated as a direct rollover under the Internal Revenue Code; or (2) The depository institution receiving the distribution is not eligible to receive a direct rollover under the Internal Revenue Code.

Legislative History

Amended by Act 2015, No. 87,§ 1, eff. 7/1/2015. Acts 1993, No. 972, § 1; 2007, No. 97, § 18; 2009, No. 468, § 23; 2011, No. 45, § 14.