§ 11:1532 — Direct rollover of eligible rollover distributions

§1532. Direct rollover of eligible rollover distributions
A. Notwithstanding any provision of this pension plan to the contrary that would
otherwise limit a distributee's election under this Section, a distributee may elect, at the time
and in the manner prescribed by the board of trustees, to have any portion of an eligible
rollover distribution paid directly to an eligible retirement plan specified by the distributee
in a direct rollover.
B. For purposes of this Section:
(1) "Direct rollover" means a payment by the plan to the eligible retirement plan
specified by the distributee.
(2)(a) "Distributee" means a member or former member.
(b) In addition, the member's or former member's surviving spouse or the member's
or former member's spouse or former spouse who is an alternate payee under a qualified
domestic relations order, as defined in Section 414(p) of the Internal Revenue Code,
hereinafter referred to in this Section as "the Code", is a "distributee" with regard to the
interest of the spouse or former spouse.
(c) The member's or former member's non-spouse beneficiary is also a distributee.
(3)(a) "Eligible retirement plan" means an individual retirement account described
in Section 408(a) of the Code, an individual retirement annuity described in Section 408(b)
of the Code, a qualified trust described in Section 401(a) of the Code, or, for a distribution
elected by a non-spouse beneficiary, an inherited individual retirement account described in
Section 402(c)(11) of the Code, that accepts the distributee's eligible rollover distribution.
(b) In the case of an eligible rollover distribution to a surviving spouse, however, an
"eligible retirement plan" is only an individual retirement account or individual retirement
annuity.
(c) In the case of an eligible rollover distribution to a non-spouse beneficiary, an
"eligible retirement plan" is only an inherited individual retirement account established for
that non-spouse beneficiary in accordance with Section 402(c)(11) of the Code.
(4) "Eligible rollover distribution" means any distribution made on or after December
1, 1994, of all or any portion of the balance to the credit of the distributee, except that an
"eligible rollover distribution" does not include: any equal periodic payments (not less
frequently than annually) made for the life (or life expectancy) of the distributee or the joint
lives (or joint life expectancies) of the distributee and the distributee's designated beneficiary
or for a specified period of ten years or more; any distribution to the extent such distribution
is required under Section 401(a)(9) of the Code; and the portion of any distribution that is
not includable in gross income.
C.(1) The fund shall, within a reasonable period of time before making an eligible
rollover distribution as provided for in Subsection A of this Section, provide a written
explanation of the following to the recipient of such distribution:
(a) The provisions under which the recipient may have the distribution directly
transferred to an eligible retirement plan and that the automatic distribution by direct transfer
applies to certain distributions in accordance with Section 401(a)(31)(B) of the Code.
(b) The provision which requires the withholding of tax on the distribution if it is not
directly transferred to an eligible retirement plan.
(c) The provisions under which the distribution will not be subject to tax if
transferred to an eligible retirement plan within sixty days after the date on which the
recipient received the distribution.
(d) The provisions under which distributions from the eligible retirement plan
receiving the distribution may be subject to restrictions and tax consequences that are
different from those applicable to distributions from the plan making such distribution.
(2) For the purposes of this Subsection, the term "reasonable period of time" shall
have the meaning assigned to it by Section 401(a)(31) of the Code and the regulations
thereunder.

Legislative History

Acts 1999, No. 34, §1; Acts 2012, No. 481, §1, eff. June 5, 2012; Acts 2018, No. 344, §1, eff. June 30, 2018.