Oklahoma Administrative Code › Title 715 - Teachers' Retirement System › Chapter 10 - General Operations › Subchapter 15 - Service Retirement › Section 715:10-15-10.2 - Partial lump-sum payments

Current through Vol. 41, No. 20, July 1, 2024
Any member of the Teachers' Retirement System with 30 or
				  more years of service credit may elect to receive a partial lump-sum payment in
				  exchange for a reduced annuity. The application for a partial lump-sum payment
				  will be added to the retiring member's final contract for retirement on a form
				  prescribed by the Board of Trustees. A beneficiary of a deceased active member
				  is not eligible to select a partial lump-sum payment.
(1) A member may elect to receive a partial
				lump-sum payment in an amount equal to the unreduced retirement benefit
				(Maximum Retirement Allowance) which would have been paid over a period of 12,
				24 or 36 months, had the lump-sum option not been selected. Once the payout
				amount is selected, a reduced Maximum Retirement Allowance is then calculated
				using factors based upon the member's age at retirement and the payout option
				(12, 24, or 36 months) selected. This reduced Maximum Retirement Allowance then
				serves as the basis upon which other optional payment alternatives will be
				calculated pursuant to 70 O.S. §
									17-105
				and OAC
				715:10-15-10.
(2) The partial lump-sum payment shall be
				paid in a single check separate from the regular monthly retirement ninety (90)
				days after the date of the retiring member's first monthly benefit payment. The
				partial lump-sum payment cannot be returned to the Retirement System once it
				has been received by the member.
(3) The partial lump-sum payment shall be
				subject to federal income tax in accordance with Internal Revenue Code or
				applicable Internal Revenue Service regulations. In accordance with IRS
				regulations, the member may elect to roll over the partial lump-sum payment
				into an eligible individual retirement account (IRA) or other eligible
				retirement plan, including the Oklahoma Teachers' Retirement System's 403b Tax
				Sheltered Annuity Plan if you already have an established account prior to
				expected retirement date.
(4) The
				total amount of the partial lump-sum payment shall be deducted from the
				member's account balance consisting of the employee contributions plus interest
				posted to the member's account prior to July 1, 1968, for the purpose of
				determining unused contributions remaining in the account.
(5) The partial lump-sum payment will be
				based on the service credit and average compensation, including projected
				compensation, at the time of retirement, but may be issued before final
				compensation and contributions are received and posted to the member's account.
				TRS reserves the right to correct any overpayment or underpayment discovered
				after final compensation and contribution postings have been received. Should
				the member have been overpaid, TRS will collect such overpayment from the
				member, based on an adjustment to the member's monthly benefit. Should the
				member have been underpaid, TRS will adjust future monthly benefit payments to
				compensate the member for the amount of the underpayment.
(6) A retiree, having received a partial
				lump-sum payment, who is reemployed and returns to membership contributing
				status pursuant to OAC
				715:10-17-13,
				shall have his or her subsequent retirement benefit calculated taking into
				consideration that a partial lump-sum payment has been received.
(7) Should the retiring member die after the
				effective date of retirement, but before the partial lump-sum payment is made,
				the payment will be made to the beneficiary(ies) designated by the retiring
				member on the final contract for retirement, unless the member filed a separate
				beneficiary form specifically designating a third party as the beneficiary of
				the partial lump-sum payment.
(8)
				If the retiring member is married at the time of retirement, the member's
				spouse must sign the member's partial lump-sum application form acknowledging
				the retiring member's intent to receive a partial lump sum payment.
Amended at 21 Ok Reg
				  3091, eff 8-21-03 through 7-14-04 (emergency)1;
				  Amended at 21 Ok Reg 3099, eff 8-12-04; Amended at 29 Ok Reg 854, eff
				  8-1-12
1This emergency action expired
				  before being superseded by a permanent action. Upon expiration of an emergency
				  amendatory action, the last prior permanent text is reinstated. Therefore, on
				  7-15-04 (after the 7-14-04 expiration of the emergency action), the text of
				  section 715:10-15-10.2 reverted back to the permanent text that was effective
				  prior to enactment of the emergency action on 8-21-03, as last published in the
				  2001 Edition of the OAC, and remained as such until amended by permanent action
				  on 8-12-04.