Okla. Admin. Code § 715:1-1-15

Current through Vol. 42, No. 4, November 1, 2024

Section 715:1-1-15 - Distribution rules

(a) Notwithstanding any other provision of the administrative code, all benefits paid from the retirement system shall be distributed in accordance with the requirements of Section 401(a)(9) of the Internal Revenue Code and Treasury Regulations § 1.401(a)(9)-1 through § 1.401(a)(9)-9, even if the member has not submitted the appropriate notice. These provisions override any distribution options that are inconsistent with Internal Revenue Code Section 401(a)(9).

(b) In furtherance of this section, the Board of Trustees and its designee will apply the following provisions:

(1) The entire interest of each member:

(A) will be distributed to such member not later than the required beginning date; or

(B) will be distributed beginning not later than the required beginning date, in accordance with Treasury regulations over the life of such member or over the lives of such member and a designated beneficiary (or over a period not extending beyond the life expectancy of such member or the life expectancies of such member and a designated beneficiary).

(2) If distribution of the member's interest has begun in accordance with subparagraph (1)(B) and the member dies before his or her entire interest has been distributed to the member, the remaining amount shall be distributed at least as rapidly as under the method of distribution being used under subparagraph (1)(B) as of the date of the member's death.

(3) If a member dies before distribution of the member's benefits begins under subparagraph (1)(B), and if any portion of the member's interest is payable to or for the benefit of a designated beneficiary for the beneficiary's lifetime or for a period not to exceed the beneficiary's life expectancy, the distribution must begin no later than December 31 of the calendar year immediately following the calendar year in which the member died. However, if the designated beneficiary is the surviving spouse of the member:

(A) the date on which the distribution is required to begin shall not be earlier than the date on which the member would have attained

(i) age 70 1/2 for distributions required to be made with respect to a member who was born on or before June 30, 1949, or

(ii) age 72 for distributions required to be made with respect to a member who was born on July 1, 1949, through December 31, 1950, or,

(iii) age 73 for distributions required to be made with respect to a member who was born after December 31, 1950, and before January 1, 1959.

(B) if the surviving spouse dies before the distribution to such spouse begins, subparagraph (1)(B) shall be applied as if the surviving spouse were the member.

(4) For benefit payments to beneficiaries that are not covered by paragraph (3), if the member dies before distribution of the member's interest has begun in accordance with subparagraph (1)(B), the member's entire interest must be distributed within 5 years after the member's death.

(5) For purposes of this section, the term "required beginning date" means April 1 of the calendar year following the later of:

(A) the calendar year in which the member reaches:

(i) age 70 1/2 for distributions required to be made with respect to a member who was born on or before June 30, 1949, or

(ii) age 72 for distributions required to be made with respect to a member who was born on July 1, 1949, through December 31, 1950,

(iii) age 73 for distributions required to be made with respect to a member who was born after December 31, 1950 and before January 1, 1959, or.

(iv) the applicable age as set forth in Internal Revenue Code Section 401(a)(9)(C)(v). or

(B) the calendar year in which the member retires or separates employment from a TRS covered employer.

(6) For purposes of determining benefits, the life expectancy of a member, a member's spouse or a member's beneficiary shall not be recalculated after benefits commence.

(7) The amount of benefits payable to a member's beneficiary may not exceed the maximum determined under the incidental death benefit requirement of the Internal Revenue Code Section 401(a)(9)(G).

Okla. Admin. Code § 715:1-1-15

Added at 11 Ok Reg 4783, eff 9-12-94 through 7-14-95 (emergency)¹; Added at 12 Ok Reg 3283, eff 7-27-95; Amended at 22 Ok Reg 2649, eff 7-11-05

Amended by Oklahoma Register, Volume 38, Issue 23, August 16, 2021, eff. 8/26/2021

Amended by Oklahoma Register, Volume 41, Issue 23, August 15, 2024, eff. 9/1/2024

¹This emergency action expired before being superseded by a permanent action. Upon expiration of an emergency action enacting a new Section, the Section is no longer effective. Therefore, on 7-15-95 (after the 7-14-95 expiration of the emergency action), the text of section 715:1-1-15 was no longer effective, and remained as such until added by permanent action on 7-27-95.