2019 Georgia Code
Title 47 - Retirement and Pensions
Chapter 2 - Employees' Retirement System of Georgia
Article 3 - Employee and Employer Contributions and Creation of Funds for Contributions, Benefits, and Administrative Expenses
§ 47-2-51.1. Supplemental Guaranteed Lifetime Income annuities
(a) For the purposes of this Code section, the term:
(1) "401(k) plan" means the State of Georgia Employees' Qualified Trust Deferred Compensation Plan.
(2) "457(b) plan" means the State of Georgia Employees' Deferred Compensation Plan.
(3) "Contingent annuitant" means an individual designated by an eligible retired member to receive survivor's benefits from an SGLI annuity.
(4) "Eligible retired member" means an individual in retirement, whether retirement is service based or due to disability, who has at least ten years of creditable service or five years of creditable service if such retired member became a member before July 1, 1968, provided that such individual has not elected a partial lump sum distribution under option six pursuant to subsection (e.4) of Code Section 47-2-121.
(5) "SGLI annuity" means a Supplemental Guaranteed Lifetime Income annuity established by the board of trustees pursuant to this Code section.
(b) On or after January 1, 2021, subject to the approval of the board of trustees and such conditions as it may prescribe and the applicable requirements of the federal Internal Revenue Code, the 401(k) plan, the 457(b) plan, and the provisions of this Code section, an eligible retired member may transfer some or all account funds from his or her 401(k) plan or 457(b) plan into an account under the Employees' Retirement System of Georgia in order to purchase an SGLI annuity, which shall supplement the member's retirement allowance under this chapter.
(c) An eligible retired member may only purchase up to two SGLI annuities and may only purchase an SGLI annuity during the period of time beginning on the commencement date of such member's retirement allowance under this chapter and ending on December 31 of the calendar year in which such member attains age 70 or in which such member's retirement allowance commences, whichever is later.
(d) An SGLI annuity shall commence on the first day of the month in which both the eligible retired member's written application and purchase amount are received by the board of trustees.
(e) An eligible retired member's election to purchase an SGLI annuity shall be irrevocable upon the retirement system's issuance of the first monthly payment of the SGLI annuity.
(f)
(1) An eligible retired member may only purchase an SGLI annuity by transferring at least $25,000.00 in aggregate from his or her 401(k) plan or 457(b) plan.
(2) (A) Such transferred amounts shall be actuarially converted to a monthly annuity for the retired member's lifetime only as described in Code Section 47-2-120.
(B) The actuarial assumptions used to determine the actuarial cost of an SGLI annuity shall be those recommended by the retirement system's actuary and approved by the board of trustees. Such actuarial assumptions may be changed from time to time upon approval of the board of trustees.
(C) The intent of this paragraph is to provide that an eligible retired member shall pay for the entire actuarial cost of an SGLI annuity.
(g)
(1) Provided that the applicable terms of the 401(k) plan or the 457(b) plan permit such use, and subject to any applicable conditions or limitations on such use, an eligible retired member may transfer some or all of his or her 401(k) plan or 457(b) plan account funds to the annuity savings fund established pursuant to Code Section 47-2-51 in order to purchase an SGLI annuity.
(2) Any such transfer shall be in compliance with the provisions of Section 401(a)(31) of the federal Internal Revenue Code and shall be recorded in the eligible retired member's SGLI annuity record.
(3) All of an eligible retired member's funds transferred to the annuity savings fund shall be expended in full as the purchase amount for the SGLI annuity.
(4) An eligible retired member shall not be permitted to purchase an SGLI annuity with funds that are not transferred from such member's 401(k) plan or 457(b) plan account.
(h)
(1) The sum of an eligible retired member's retirement allowance calculated as a monthly annuity for such member's lifetime as of the commencement date of such retirement allowance and any SGLI annuities calculated as a monthly annuity for such member's lifetime shall not exceed 90 percent of his or her highest month of earnable compensation. An eligible retired member shall not be permitted to purchase an SGLI annuity that would cause such 90 percent limit to be exceeded.
(2) If such limited amount exceeds the limits of Section 415(b) of the federal Internal Revenue Code, such excess shall be paid from the Supplemental Retirement Benefit Plan authorized by the board of trustees, which provides for benefit payments in excess of such Section 415(b) limitations.
(i)
(1) An eligible retired member shall elect how to receive an SGLI annuity, either as an annuity for the retired member's lifetime only or as any of the optional forms of payment specified in Code Section 47-2-121 with the exception of option six under subsection (e.4) of such Code section, even if the annuity payment option selected for the SGLI annuity is different from that elected by the member with respect to his or her retirement allowance under this chapter.
(2) The SGLI optional form calculation shall be based on the age of the eligible retired member and such member's contingent annuitants, if applicable, as of the commencement date of the SGLI annuity.
(3) An eligible retired member may elect an SGLI annuity that permits a refund of the balance of the purchase amount to the member's contingent annuitants or estate in the event the retired member and his or her contingent annuitants, if applicable, die prior to receiving total SGLI annuity payments that equal or exceed the SGLI annuity purchase amount. Unless the terms of the SGLI annuity form as elected by an eligible retired member provide for such refund, no part of the SGLI purchase amount shall be refunded or paid to any person, estate, or other entity upon the death of the retired member or any contingent annuitant.
(j)
(1) An SGLI annuity shall be subject to increases and decreases in the monthly annuity amount payable based on the form and terms of the SGLI annuity purchased by the retired member.
(2) SGLI annuities shall not be eligible for ad hoc or other postretirement benefit increases approved by the board of trustees, including cost-of-living adjustments, pursuant to Code Section 47-2-29.
(3) No interest shall be paid on amounts transferred to the annuity savings fund for purposes of purchasing an SGLI annuity.
(k)
(1) An eligible retired member who elects to purchase an SGLI annuity shall not be permitted to receive a partial lump sum distribution under option six pursuant to subsection (e.4) of Code Section 47-2-121.
(2) Any requirements under this chapter relating to suspension of benefits for rehired retirees shall not apply to SGLI annuity payments.
(3) No additional creditable service shall be granted for any purpose under this chapter as a result of the transfer of any funds from a 401(k) plan or 457(b) plan for the purchase of an SGLI annuity; nor shall such purchase otherwise be considered in computing a member's retirement allowance.
(l) Any other provision of law notwithstanding, the board of trustees may suspend issuance of new SGLI annuities at any time. Such a suspension shall be prospective in operation and shall not affect SGLI annuities already in effect. Following such a suspension, the board of trustees in its discretion may reinstate the issuance of SGLI annuities at any time.
(m)
(1) The administration of the SGLI annuity requires that SGLI purchase costs vary from time to time and members shall not have any right to any particular purchase price.
(2) SGLI annuity payments shall be subject to the minimum distribution rules of federal Internal Revenue Code Section 401(a)(9).
Code 1981, § 47-2-51.1, enacted by Ga. L. 2019, p. 783, § 2/SB 55.
