§ 36-8-7-2.5 — Qualification of 1937 fund under Internal Revenue Code; benefit limitations

Indiana § 36-8-7-2.5

• Jurisdiction: Indiana
• Title 36: LOCAL GOVERNMENT
• Art. 8: PUBLIC SAFETY
• Ch. 7: 1937 Firefighters' Pension Fund

Text

5. (a) As used in this chapter, "Internal
Revenue Code":
(1) means the Internal Revenue Code of 1954, as in effect on
September 1, 1974, if permitted with respect to governmental
plans; or
(2) to the extent not inconsistent with subdivision (1), has the
meaning set forth in IC 6-3-1-11.
(b) The 1937 fund shall satisfy the qualification requirements in
Section 401 of the Internal Revenue Code, as applicable to the 1937
fund. In order to meet those requirements, the 1937 fund is subject to
the following provisions, notwithstanding any other provision of this
chapter:
(1) The local board shall distribute the corpus and income of the
1937 fund to members and their beneficiaries in accordance with
this chapter.
(2) No part of the corpus or income of the 1937 fund may be used
or diverted to any purpose other than the exclusive benefit of the
members and their beneficiaries.
(3) Forfeitures arising from severance of employment, death, or
for any other reason may not be applied to increase the benefits
any member would otherwise receive under this chapter.
(4) If the 1937 fund is terminated, or if all contributions to the
1937 fund are completely discontinued, the rights of each affected
member to the benefits accrued at the date of the termination or
discontinuance, to the extent then funded, are nonforfeitable.
(5) All benefits paid from the 1937 fund shall be distributed in
accordance with the requirements of Section 401(a)(9) of the
Internal Revenue Code and the regulations under that section. In
order to meet those requirements, the 1937 fund is subject to the
following provisions:
(A) The life expectancy of a member, the member's spouse, or
the member's beneficiary shall not be recalculated after the
initial determination, for purposes of determining benefits.
(B) If a member dies before the distribution of the member's
benefits has begun, distributions to beneficiaries must begin no
later than December 31 of the calendar year immediately
following the calendar year in which the member died.
(C) The amount of an annuity paid to a member's beneficiary
may not exceed the maximum determined under the incidental
death benefit requirement of the Internal Revenue Code.
(6) The local board may not:
(A) determine eligibility for benefits;
(B) compute rates of contribution; or
(C) compute benefits of members or beneficiaries;
in a manner that discriminates in favor of members who are
considered officers, supervisors, or highly compensated, as
prohibited under Section 401(a)(4) of the Internal Revenue Code.
(7) Benefits paid under this chapter may not exceed the maximum
benefit specified by Section 415 of the Internal Revenue Code.
(8) The salary taken into account under this chapter may not
exceed the applicable amount under Section 401(a)(17) of the
Internal Revenue Code.
(9) The local board may not engage in a transaction prohibited by
Section 503(b) of the Internal Revenue Code.
(c) Notwithstanding any other provision of this chapter, and solely
for the purposes of the benefits provided under this chapter, the benefit
limitations of Section 415 of the Internal Revenue Code shall be
determined by applying the provisions of Section 415(b)(10) of the
Internal Revenue Code, as amended by the Technical and
Miscellaneous Revenue Act of 1988. This section constitutes an
election under Section 415(b)(10)(C) of the Internal Revenue Code to
have Section 415(b) of the Internal Revenue Code, other than Section
415(b)(2)(G) of the Internal Revenue Code, applied without regard to
Section 415(b)(2)(F) of the Internal Revenue Code (before its repeal on
June 7, 2001, by P.L.107-16) to anyone who did not first become a
participant before January 1, 1990.

Legislative History

As added by P.L.55-1989, SEC.52. Amended by P.L.4-1990, SEC.16; P.L.42-2011, SEC.82.