2013 Indiana Code
TITLE 5. STATE AND LOCAL ADMINISTRATION
ARTICLE 10.2. PUBLIC RETIREMENT AND DISABILITY BENEFITS
CHAPTER 4. RETIREMENT AND DISABILITY BENEFITS
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IC 5-10.2-4
Chapter 4. Retirement and Disability Benefits
IC 5-10.2-4-0.1
Application of certain amendments to chapter
Sec. 0.1. The following amendments to this chapter apply as
follows:
(1) The amendments made by P.L.45-1988 to STEP TWO of
section 4(b) of this chapter (formerly section 4(a) of this
chapter):
(A) apply only to retirement benefits paid after March 3,
1988; and
(B) do not require retroactive increases in any benefits paid
before March 3, 1988.
(2) The amendments made to section 3 of this chapter by
P.L.95-2004 apply only to members of the Indiana state
teachers' retirement fund who retire after May 31, 2004.
(3) The amendments made to section 8 of this chapter by
P.L.62-2005 apply to:
(A) fiscal years that begin after June 30, 2005, for teachers'
retirement fund members; and
(B) calendar years that begin after December 31, 2005, for
public employees' retirement fund members.
(4) The amendments made to section 6 of this chapter by
P.L.124-2008 apply to disability retirement benefits payable by
the Indiana state teachers' retirement fund and the public
employees' retirement fund after December 31, 2007.
As added by P.L.220-2011, SEC.73.
IC 5-10.2-4-0.3
Consideration of certain claims for benefits
Sec. 0.3. The board may consider a claim for benefits under
section 6(a) of this chapter, as amended by P.L.22-1998, even if the
disability of the member making the claim arose from events
occurring after March 31, 1994, and before April 2, 1998. A benefit
claim approved by the board under this section is payable after the
later of April 1, 1998, or the date of the member's claim.
As added by P.L.220-2011, SEC.74.
IC 5-10.2-4-1
Eligibility for normal and early retirement
Sec. 1. (a) This subsection applies to:
(1) members of the public employees' retirement fund who
retire before July 1, 1995; and
(2) members of the Indiana state teachers' retirement fund who
retire before May 2, 1989.
A member who has reached age sixty-five (65) and has at least ten
(10) years of creditable service is eligible for normal retirement.
(b) This subsection applies to members of the Indiana state
teachers' retirement fund who retire after May 1, 1989, and to
members of the public employees' retirement fund who retire after
June 30, 1995, except as provided in section 1.7 of this chapter. A
member is eligible for normal retirement if:
(1) the member is at least sixty-five (65) years of age and has at
least ten (10) years of creditable service;
(2) the member is at least sixty (60) years of age and has at least
fifteen (15) years of creditable service; or
(3) the member's age in years plus the member's years of service
is at least eighty-five (85) and the member is at least fifty-five
(55) years of age.
(c) A member who has reached age fifty (50) and has at least
fifteen (15) years of creditable service is eligible for early retirement
with a reduced pension.
(d) A member who is eligible for normal or early retirement is
entitled to choose a retirement date on which the member's benefit
begins if the following conditions are met:
(1) The application for retirement benefits and the choice of the
date is filed on a form provided by the board.
(2) The date must be after the cessation of the member's service
and be the first day of a month.
(3) The retirement date is not more than six (6) months before
the date the application is received by the board. However, if
the board determines that a member is incompetent to file for
benefits and choose a retirement date, the retirement date may
be any date that is the first of the month after the time the
member became incompetent.
As added by Acts 1977, P.L.53, SEC.2. Amended by Acts 1980,
P.L.28, SEC.5; P.L.48-1985, SEC.1; P.L.342-1989(ss), SEC.2;
P.L.4-1990, SEC.7; P.L.10-1995, SEC.4; P.L.73-2002, SEC.2.
IC 5-10.2-4-1.2
Direct deposit of benefits; waiver of direct deposit requirement
Sec. 1.2. (a) Each fund shall adopt a policy that requires direct
deposit or another method approved by the board as the preferred
way for members and beneficiaries to receive monthly benefits.
(b) A member or beneficiary who does not wish to have payments
to the person deposited by direct deposit or another method approved
by the board under subsection (a) may request the board or a
designee of the board to grant a waiver of the requirement of direct
deposit or another method approved by the board. The member or
beneficiary must:
(1) state the reason to the board for requesting the waiver; and
(2) sign a waiver form.
(c) The board or a designee of the board shall grant the member's
or beneficiary's request for a waiver, approval of which shall not be
unreasonably denied, if any of the following apply:
(1) The member or beneficiary currently does not have a
savings or checking account.
(2) The member or beneficiary is unable to establish a savings
or checking account within the geographic area of the home of
the member or beneficiary without payment of a service fee. In
support of this reason, the member or beneficiary must submit
a written statement of the inability to establish the account
without the payment of a fee with the waiver request.
(3) The home of the member or beneficiary is too remote to
have access to a financial institution where direct deposit or
another method approved by the board may be made.
(4) The financial institution of the member or beneficiary is
unable to:
(A) accept direct deposit or another method approved by the
board; or
(B) process electronic withdrawal.
The member or beneficiary must submit with the waiver a
written statement from the financial institution of the member
or beneficiary that the financial institution is unable to accept
direct deposit or another method approved by the board or
process electronic withdrawal.
(5) The board determines that the facts of the particular case
warrant a waiver of the requirement of direct deposit or another
method approved by the board.
(d) The policy of the board must provide that a member or
beneficiary who is in pay status as of July 1, 2009, and is receiving
monthly benefits in a manner other than direct deposit or another
method approved by the board shall not have the monthly benefits
stopped for receiving monthly benefits in a manner other than direct
deposit or another method approved by the board.
As added by P.L.47-2003, SEC.1. Amended by P.L.115-2009, SEC.3.
IC 5-10.2-4-1.3
Application procedure
Sec. 1.3. (a) A member who files an application for retirement
benefits must provide the following information on the application
form:
(1) The retirement date chosen by the member.
(2) If the member has not elected to withdraw the entire amount
in the member's annuity savings account under IC 5-10.2-3-6.5,
whether the member chooses:
(A) an annuity purchased from the amount credited to the
member in the annuity savings account;
(B) a total or partial distribution from the annuity savings
account under section 2(b) of this chapter; or
(C) a deferral of the payment of any benefits from the
annuity savings account under section 2(c) of this chapter.
(3) The name of the beneficiary or beneficiaries designated by
the member with respect to the pension portion of the member's
retirement benefit.
(4) The name of the beneficiary or beneficiaries designated by
the member with respect to the annuity portion of the member's
retirement benefit, unless the member chooses total distribution
under section 2 of this chapter.
(b) A member's designation of beneficiaries in the application for
retirement benefits supersedes any previous designation of
beneficiaries by the member.
(c) A member must indicate the name, address, date of birth, and
Social Security number of each designated beneficiary and provide
proof of birth of each designated beneficiary.
(d) The board shall adopt a form for the application for retirement
benefits that meets the requirements of this section.
As added by P.L.195-1999, SEC.13. Amended by P.L.115-2008,
SEC.9; P.L.35-2012, SEC.41.
IC 5-10.2-4-1.4
Direct deposit benefit notice
Sec. 1.4. (a) This section applies to a member or a beneficiary of
the fund who receives a monthly benefit by direct deposit.
(b) The fund shall furnish to the member or beneficiary:
(1) before each change in the amount of the member's or
beneficiary's benefit; or
(2) once every twelve (12) months, if the member's or
beneficiary's benefit amount does not change;
a written notice showing the member's or beneficiary's benefit
amount, including any cost of living increase or other adjustment to
the benefit amount, and a summary of the member's or beneficiary's
benefit payment history since the member's or beneficiary's last
written notice.
As added by P.L.47-2003, SEC.2. Amended by P.L.115-2009, SEC.4.
IC 5-10.2-4-1.5
Estimated benefit payments
Sec. 1.5. (a) A fund may calculate and pay an estimated retirement
benefit of the pension portion to a member if:
(1) the member has applied for a retirement benefit and has
chosen a retirement date on which the retirement benefit is to
begin;
(2) the member's membership records are incomplete or have
not been certified; and
(3) the member's membership records that have been submitted
to the fund establish that the member is entitled to a retirement
benefit.
(b) After June 30, 2009, if a fund calculates and pays an estimated
benefit under this section, the estimated benefit must be at least
eighty-five percent (85%) of the pension portion of the benefit
determined under the fund's records on service and compensation
information.
(c) If an estimated benefit is paid to a member under this section,
the fund shall, after all membership records have been submitted to
the fund and certified, determine the actual retirement benefit to
which the member is entitled. After determining the actual retirement
benefit to which the member is entitled, the fund shall temporarily
adjust the actual retirement benefit that is paid to the member to
reconcile any underpayment or overpayment of benefits to the
member that resulted from the payment of estimated benefits. The
fund may make the temporary adjustment to the member's actual
retirement benefit over a reasonable time, as determined by the
board.
As added by P.L.195-1999, SEC.14. Amended by P.L.115-2009,
SEC.5.
IC 5-10.2-4-1.7
Elected county official eligibility for normal retirement
Sec. 1.7. (a) This section applies only to members of the public
employees' retirement fund who retire after June 30, 2002.
(b) A member is eligible for normal retirement after becoming
sixty-five (65) years of age if the member:
(1) has:
(A) served as an elected county official in an office
described in Article 6, Section 2 of the Constitution of the
State of Indiana for at least eight (8) years; or
(B) been elected at least two (2) times and would have
served at least eight (8) years as an elected county official in
an office described in Article 6, Section 2 of the Constitution
of the State of Indiana had the member's term of office not
been shortened under a statute enacted under Article 6,
Section 2(b) of the Constitution of the State of Indiana; and
(2) is prohibited by Article 6, Section 2 of the Constitution of
the State of Indiana from serving in that office for more than
eight (8) years in any period of twelve (12) years.
(c) A member who:
(1) has served as an elected county official; and
(2) does not meet the requirements of subsection (b);
is eligible for normal retirement if the member has attained vested
status (as defined in IC 5-10.2-1-8(b)(3)) and meets the requirements
of section 1 of this chapter.
As added by P.L.73-2002, SEC.3. Amended by P.L.88-2005, SEC.2.
IC 5-10.2-4-1.9
Eligibility of certain state officers for normal retirement
Sec. 1.9. (a) This section applies only to a member of the public
employees' retirement fund:
(1) who has served as a state officer listed in Article 6, Section
1 of the Constitution of the State of Indiana; and
(2) whose term of office as a state officer commenced after the
election held on November 5, 2002.
(b) A member is eligible for normal retirement after becoming
sixty-five (65) years of age if the member:
(1) has:
(A) served as a state officer listed in Article 6, Section 1 of
the Constitution of the State of Indiana for at least eight (8)
years; or
(B) been elected at least two (2) times and would have
served at least eight (8) years as a state officer listed in
Article 6, Section 1 of the Constitution of the State of
Indiana had the member's term of office not been shortened
under a statute enacted to establish uniform dates for
beginning the terms of state officers listed in Article 6,
Section 1 of the Constitution of the State of Indiana; and
(2) is prohibited by Article 6, Section 1 of the Constitution of
the State of Indiana from serving in that office for more than
eight (8) years in any period of twelve (12) years.
(c) A member who:
(1) has served as a state officer listed in Article 6, Section 1 of
the Constitution of the State of Indiana; and
(2) does not meet the requirements of subsection (b);
is eligible for normal retirement if the member has attained vested
status (as defined in IC 5-10.2-1-8(a)) and meets the requirements of
section 1 of this chapter.
As added by P.L.115-2008, SEC.10.
IC 5-10.2-4-2
Annuity or distribution benefits; choice of plans; contributions
paid as lump sum
Sec. 2. (a) Unless a member elects otherwise under this section or
has elected to withdraw the member's annuity savings account under
IC 5-10.2-3-6.5, the retirement benefit for each member consists of
the sum of a pension provided by employer contributions plus an
annuity provided by the amount credited to the member in the
annuity savings account. If a member has elected to withdraw the
member's annuity savings account under IC 5-10.2-3-6.5, the
member's retirement benefit is equal to the pension provided by
employer contributions, unless the member has transferred the
creditable service earned under the public employees' retirement fund
to another governmental retirement plan under IC 5-10.2-3-1(i).
Regardless of a member's election under this section, contributions
totaling not more than one thousand dollars ($1,000) that are posted
to a member's annuity savings account after the final date on which
the member's retirement benefit is processed may be distributed to
the member as a lump sum payment.
(b) If a member has not elected to withdraw the entire amount in
the member's annuity savings account under IC 5-10.2-3-6.5, a
member may choose at retirement or upon a disability retirement to
receive a distribution of:
(1) the entire amount credited to the member in the annuity
savings account; or
(2) an amount equal to the member's federal income tax basis in
the member's annuity savings account balance as it existed on
December 31, 1986.
If the member chooses to receive the distribution under subdivision
(1), the member is not entitled to an annuity as part of the retirement
or disability benefit. If the member chooses to receive the
distribution under subdivision (2), the member is entitled to an
annuity purchasable by the amount remaining in the member's
annuity savings account after the payment under subdivision (2).
(c) Instead of choosing to receive the benefits described in
subsection (a) or (b), if a member has not elected to withdraw the
entire amount in the member's annuity savings account under
IC 5-10.2-3-6.5, a member may choose upon retirement or upon
disability retirement to begin receiving a pension provided by
employer contributions and to defer receiving in any form the
member's annuity savings account. If a member chooses this option,
the member:
(1) is not entitled to an annuity as part of the member's
retirement or disability benefit, and the member's annuity
savings account will continue to be invested according to the
member's direction under IC 5-10.2-2-3; and
(2) may later choose, as of the first day of a month, or an
alternate date established by the rules of the board, to receive a
distribution of:
(A) the entire amount credited to the member in the annuity
savings account; or
(B) an amount equal to the member's federal income tax
basis in the member's annuity savings account balance as it
existed on December 31, 1986.
If the member chooses to receive the distribution under subdivision
(2)(A), the member is not entitled to an annuity as part of the
member's retirement or disability benefit. If the member chooses to
receive the distribution under subdivision (2)(B), the member is
entitled to an annuity purchasable by the amount remaining in the
member's annuity savings account after the payment under
subdivision (2)(B). If the member does not choose to receive a
distribution under this subsection, the member is entitled to an
annuity purchasable by the entire amount in the member's annuity
savings account, and the form of the annuity shall be as described in
subsection (d) unless the member elects an option described in
section 7(b)(1), 7(b)(2), or 7(b)(4) of this chapter. The amount to be
paid under this section shall be determined in the manner described
in IC 5-10.2-2-3. However, the board may by rule provide for an
alternate valuation date.
(d) Retirement benefits must be distributed in a manner that
complies with Section 401(a)(9) of the Internal Revenue Code, as
specified in IC 5-10.2-2-1.5.
As added by Acts 1977, P.L.53, SEC.2. Amended by P.L.35-1985,
SEC.12; P.L.55-1989, SEC.16; P.L.59-1989, SEC.1; P.L.195-1999,
SEC.15; P.L.62-2005, SEC.2; P.L.115-2008, SEC.11; P.L.115-2009,
SEC.6; P.L.35-2012, SEC.42.
IC 5-10.2-4-3
Average of the annual compensation
Sec. 3. (a) Except as provided in subsection (f), in computing the
retirement benefit for a nonteacher member, "average of the annual
compensation" means the average annual compensation calculated
using the twenty (20) calendar quarters of service in a position
covered by the retirement fund before retirement in which the
member's annual compensation was the highest. However, in order
for a quarter to be included in the twenty (20) calendar quarters, the
nonteacher member must have performed service throughout the
calendar quarter. All twenty (20) calendar quarters do not have to be
continuous but they must be in groups of four (4) consecutive
calendar quarters. The same calendar quarter may not be included in
two (2) different groups.
(b) This subsection does not apply to a teacher member described
in subsection (c). In computing the retirement benefit for a teacher
member, "average of the annual compensation" means the average
annual compensation for the five (5) years of service before
retirement in which the member's annual compensation was highest.
In order for a year to be included in the five (5) years, the teacher
member must have received for the year credit under IC 5-10.4-4-2
for at least one-half (1/2) year of service. The five (5) years do not
have to be continuous.
(c) This subsection applies to a member of the Indiana state
teachers' retirement fund who serves in an elected position for which
the member takes an unpaid leave of absence. In computing the
retirement benefit for a teacher member described in this subsection
for years of service to which IC 5-10.4-5-7 does not apply, "average
of the annual compensation" means the annual compensation for the
one (1) year of service before retirement in which the member's
annual compensation was highest. In order for a year to be used, the
teacher member must have received for the year credit under
IC 5-10.4-4-2 for at least one-half (1/2) year of service.
(d) Subject to IC 5-10.2-2-1.5, "annual compensation" means:
(1) the basic salary earned by and paid to the member plus the
amount that would have been part of that salary but for:
(A) the state's, a school corporation's, a participating
political subdivision's, or a state educational institution's
paying the member's contribution to the fund for the
member; or
(B) the member's salary reduction agreement established
under Section 125, 403(b), or 457 of the Internal Revenue
Code; and
(2) in the case of a member described in subsection (c) and for
years of service to which IC 5-10.4-5-7 does not apply, the basic
salary that was not paid during the year but would have been
paid to the member during the year under the member's
employment contracts, if the member had not taken any unpaid
leave of absence to serve in an elected position.
The portion of a back pay award or a similar award that the board
determines is compensation under an agreement or under a judicial
or an administrative proceeding shall be allocated by the board
among the years the member earned or should have earned the
compensation. Only that portion of the award allocated to the year
the award is made is considered to have been earned during the year
the award was made. Interest on an award is not considered annual
compensation for any year.
(e) Compensation of not more than two thousand dollars ($2,000)
received from the employer in contemplation of the member's
retirement, including severance pay, termination pay, retirement
bonus, or commutation of unused sick leave or personal leave, may
be included in the total annual compensation from which the average
of the annual compensation is determined, if it is received:
(1) before the member ceases service; or
(2) within twelve (12) months after the member ceases service.
(f) This subsection applies to a member of the general assembly:
(1) who is a participant in the legislators' retirement system
established under IC 2-3.5;
(2) who is also a member of the public employees' retirement
fund or the Indiana state teachers' retirement fund; and
(3) whose years of service in the general assembly may not be
considered in determining the average of the annual
compensation under this section, as provided in
IC 2-3.5-1-2(b)(2) or IC 2-3.5-3-1(c).
The board shall use the board's actuarial salary increase assumption
to project the salary for any previous year needed to determine the
average of the annual compensation.
As added by Acts 1977, P.L.53, SEC.2. Amended by P.L.28-1984,
SEC.2; P.L.35-1985, SEC.13; P.L.55-1989, SEC.17; P.L.6-1989,
SEC.2; P.L.4-1990, SEC.8; P.L.10-1993, SEC.4; P.L.95-2004,
SEC.2; P.L.2-2006, SEC.24; P.L.2-2007, SEC.93.
IC 5-10.2-4-3.1
Compensation from two or more employers; computation of
average
Sec. 3.1. For a member who receives annual compensation from
two (2) or more employers, the average of the annual compensation
shall be computed using the sum of the two (2) or more annual
compensations if:
(1) each of the employers and the member made all of the
contributions required by IC 5-10.2; and
(2) the member occupied at least one (1) position that normally
required performance of service of more than six hundred (600)
hours during the year.
As added by P.L.381-1987(ss), SEC.1.
IC 5-10.2-4-4
Retirement benefit computation
Sec. 4. (a) The computation of benefits under this section is
subject to IC 5-10.2-2-1.5.
(b) For retirement benefits payable on and after July 1, 1975, for
a member retired on and after January 1, 1956, the pension (p) is
computed as follows:
STEP ONE: Multiply one and one-tenths percent (1.1%) times
the average of the annual compensation (aac) and obtain a
product.
STEP TWO: To obtain the pension, multiply the STEP ONE
product by the total creditable service (scr) completed by the
member on the member's retirement date.
Expressed mathematically:
p = (.011) times (aac) times (scr)
(c) Unless the member:
(1) has chosen a lump sum payment under section 2(b) of this
chapter;
(2) has elected to withdraw the entire amount in the member's
annuity savings account under IC 5-10.2-3-6.5; or
(3) elects to defer receiving in any form the member's annuity
savings account under section 2(c) of this chapter;
the annuity is the amount purchasable on the member's retirement
date by the amount credited to the member in the annuity savings
account. The amount purchasable is based on actuarial tables adopted
by the board under IC 5-10.2-2-10 at an interest rate determined by
the board.
As added by Acts 1977, P.L.53, SEC.2. Amended by Acts 1980,
P.L.28, SEC.6; P.L.35-1985, SEC.14; P.L.45-1988, SEC.1;
P.L.55-1989, SEC.18; P.L.195-1999, SEC.16; P.L.115-2008,
SEC.12.
IC 5-10.2-4-5
Early retirement percent reduction
Sec. 5. The retirement benefit (rb) payable on and after July 1,
1975, for a member who retired on and after January 1, 1956, before
age sixty-five (65) is the sum of the pension (P), as specified in
section 4 of this chapter and computed on the basis of the total
creditable service and the average of the annual compensation at
retirement, multiplied by a percent (p), plus the annuity (A), if any,
purchasable by the amount credited to the member in the annuity
savings account. This sum is obtained by the following STEPS:
STEP ONE: From seven hundred eighty (780) months, which
equals sixty-five (65) years, subtract the age of the member at
his retirement date expressed in whole months (retirement age
in months) and obtain a remainder (X).
STEP TWO:
(i) If the remainder (X) is less than or equal to sixty (60),
then multiply the remainder (X) times one-tenth percent
(0.1%) and obtain a product (Y).
(ii) If the remainder (X) is greater than sixty (60), then
multiply five-twelfths percent (5/12%) times the difference
obtained by subtracting sixty (60) from the remainder (X)
and obtain a product. Add to this six percent (6%) and obtain
a sum (Y).
STEP THREE: From one hundred percent (100%) subtract the
appropriate (Y) and obtain the percent (p).
STEP FOUR: The early retirement benefit equals (p) times (P)
plus the annuity (A).
Expressed mathematically:
If "<" means "less than or equal to" and if ">" means "greater
than"; then:
(I) 780 - (retire age in months) = X;
(II) if X < 60, (X) times (0.1%) = Y; or
if X > 60, (5/12%) times (X-60) + 6% = Y
(III) 100% - Y = p
(IV) rb = pP + A
As added by Acts 1977, P.L.53, SEC.2. Amended by P.L.35-1985,
SEC.15.
IC 5-10.2-4-6
Disability retirement
Sec. 6. (a) A member who becomes disabled while receiving a
salary or employer provided income protection benefits or who is on
leave under the Family and Medical Leave Act may retire for the
duration of the member's disability if:
(1) the member has at least five (5) years of creditable service
before the:
(A) termination of a salary or employer provided income
protection benefits or Family and Medical Leave Act leave;
or
(B) exhaustion of all worker's compensation benefits;
(2) the member has qualified for Social Security disability
benefits and has furnished proof of the Social Security
qualification to the board; and
(3) at least once each year until the member reaches age
sixty-five (65) a representative of the board verifies the
continued disability.
For the purposes of this section, a member of the public employees'
retirement fund who has qualified for disability benefits under the
federal civil service system is considered to have met the requirement
of subdivision (2) if the member furnishes proof of the qualification
to the board.
(b) Benefits for disability shall be paid beginning with the month
following the onset of disability as determined by the Social Security
Administration. The benefit is the retirement benefit specified in
section 4 of this chapter with the pension computed using only the
years of creditable service worked to the date of disability and
without reduction for early retirement. The monthly disability
retirement benefit payable before July 1, 2008, may not be less than
one hundred dollars ($100). The monthly disability retirement
benefit payable after June 30, 2008, may not be less than one
hundred eighty dollars ($180).
(c) The member may have the member's benefit paid under any of
the retirement benefit options specified in section 7 of this chapter,
except that the member may not choose to have the member's
disability retirement benefit paid under the method specified under
section 7(b)(3) of this chapter.
(d) This section applies to:
(1) a member of the public employees' retirement fund who
became disabled after June 30, 1973; and
(2) a member of the Indiana state teachers' retirement fund who
becomes disabled after June 30, 1984, and who chooses
disability retirement under this section.
(e) To the extent required by the Americans with Disabilities Act
(42 U.S.C. 12101 et seq.) and any amendments and regulations to the
Act, the transcripts, records, and other material compiled to
determine the existence of a disability shall be:
(1) kept in separate medical files for each member; and
(2) treated as confidential medical records.
(f) A member may continue to receive disability benefits from the
public employees' retirement fund or the Indiana state teachers'
retirement fund so long as the member is entitled to receive Social
Security benefits, including periods of trial employment or
rehabilitation under the Social Security guidelines. However, during
a period of trial employment or rehabilitation, service credit may not
be granted under the public employees' retirement fund or the Indiana
state teachers' retirement fund.
(g) If the fund is authorized to make, in the form of a single check
or a series of checks, a one (1) time distribution that does not
increase the pension portion of the monthly benefit, the distribution
must include members eligible for disability benefits. A member
eligible for disability benefits is required to meet all additional
requirements necessary to receive the check or series of checks
issued by the fund under this subsection.
As added by Acts 1977, P.L.53, SEC.2. Amended by Acts 1978,
P.L.24, SEC.2; P.L.29-1984, SEC.1; P.L.4-1992, SEC.9;
P.L.22-1998, SEC.6; P.L.124-2008, SEC.2; P.L.131-2008, SEC.1;
P.L.35-2012, SEC.43.
IC 5-10.2-4-7
Retirement benefit payment options; changes to beneficiary
designation or form of benefit; annual payment of monthly benefit
Sec. 7. (a) Benefits provided under this section are subject to
IC 5-10.2-2-1.5.
(b) A member who retires is entitled to receive monthly retirement
benefits, which are guaranteed for five (5) years or until the
member's death, whichever is later. A member may select in writing
any of the following nonconflicting options for the payment of the
member's retirement benefits instead of the five (5) year guaranteed
retirement benefit payments. The amount of the optional payments
shall be determined under rules of the board and shall be the
actuarial equivalent of the benefit payable under sections 4, 5, and 6
of this chapter. A member who has elected to withdraw the entire
amount in the member's annuity savings account under
IC 5-10.2-3-6.5 may not select the cash refund annuity option.
(1) Joint and Survivor Option.
(A) The member receives a decreased retirement benefit
during the member's lifetime, and there is a benefit payable
after the member's death to a designated beneficiary during
the lifetime of the beneficiary, which benefit equals, at the
option of the member, either the full decreased retirement
benefit or two-thirds (2/3) or one-half (1/2) of that benefit.
(B) If the member dies before retirement, the designated
beneficiary may receive only the amount credited to the
member in the annuity savings account unless the designated
beneficiary is entitled to survivor benefits under IC 5-10.2-3.
(C) If the designated beneficiary dies before the member
retires, the selection is automatically canceled and the
member may make a new beneficiary election and may elect
a different form of benefit under this subsection.
(2) Benefit with No Guarantee. The member receives an
increased lifetime retirement benefit without the five (5) year
guarantee specified in this subsection.
(3) Integration with Social Security. If the member retires
before the age of eligibility for Social Security benefits, in order
to provide a level benefit during the member's retirement the
member receives an increased retirement benefit until the age
of Social Security eligibility and decreased retirement benefits
after that age.
(4) Cash Refund Annuity. The member receives a lifetime
annuity purchasable by the amount credited to the member in
the annuity savings account, and the member's designated
beneficiary receives a refund payment equal to:
(A) the total amount used in computing the annuity at the
retirement date; minus
(B) the total annuity payments paid and due to the member
before the member's death.
(c) This subsection does not apply to a member of the Indiana
state teachers' retirement fund after June 30, 2007, or to a member of
the public employees' retirement fund after June 30, 2008. If:
(1) the designated beneficiary dies while the member is
receiving benefits; or
(2) the member is receiving benefits, the member marries, either
for the first time or following the death of the member's spouse,
after the member's first benefit payment is made, and the
member's designated beneficiary is not the member's current
spouse or the member has not designated a beneficiary;
the member may elect to change the member's designated beneficiary
or form of benefit under subsection (b) and to receive an actuarially
adjusted and recalculated benefit for the remainder of the member's
life or for the remainder of the member's life and the life of the newly
designated beneficiary. The member may not elect to change to a five
(5) year guaranteed form of benefit. If the member's new election is
the joint and survivor option, the member shall indicate whether the
designated beneficiary's benefit shall equal, at the option of the
member, either the member's full recalculated retirement benefit or
two-thirds (2/3) or one-half (1/2) of this benefit. The cost of
recalculating the benefit shall be borne by the member and shall be
included in the actuarial adjustment.
(d) Except as provided in subsection (c) or section 7.2 of this
chapter, a member who files for regular or disability retirement may
not change:
(1) the member's retirement option under subsection (b);
(2) the selection of a lump sum payment under section 2 of this
chapter; or
(3) the beneficiary designated on the member's application for
benefits if the member selects the joint and survivor option
under subsection (b)(1);
after the first day of the month in which benefit payments are
scheduled to begin. For purposes of this subsection, it is immaterial
whether a benefit check has been sent, received, or negotiated.
(e) A member may direct that the member's retirement benefits be
paid to a revocable trust that permits the member unrestricted access
to the amounts held in the revocable trust. The member's direction is
not an assignment or transfer of benefits under IC 5-10.3-8-10 or
IC 5-10.4-5-14.5.
(f) The board may adopt a policy to permit annual payment of a
member's retirement benefit whenever the amount of the monthly
retirement benefit to be paid to the member is not more than five
dollars ($5).
As added by Acts 1977, P.L.53, SEC.2. Amended by Acts 1980,
P.L.28, SEC.7; P.L.35-1985, SEC.16; P.L.59-1989, SEC.2;
P.L.55-1989, SEC.19; P.L.59-1989, SEC.3; P.L.4-1990, SEC.9;
P.L.195-1999, SEC.17; P.L.246-2001, SEC.5; P.L.190-2003, SEC.2;
P.L.2-2006, SEC.25; P.L.149-2007, SEC.1; P.L.93-2008, SEC.1;
P.L.115-2008, SEC.13; P.L.115-2009, SEC.7; P.L.35-2012, SEC.44;
P.L.15-2013, SEC.1.
IC 5-10.2-4-7.2
Changes to beneficiary designation
Sec. 7.2. (a) This section applies to the following:
(1) A member of the Indiana state teachers' retirement fund after
June 30, 2007.
(2) A member of the public employees' retirement fund after
June 30, 2008.
(b) Subject to subsection (g), if a member is receiving a benefit
from the fund and:
(1) the member's designated beneficiary dies;
(2) the member and the member's designated beneficiary have
been parties in an action for dissolution of marriage in which a
final order has been issued after the member's first benefit
payment is made. It is immaterial whether the final order was
issued before, on, or after the date in subsection (a)(1) or (a)(2);
or
(3) the member marries after the member's first benefit payment
is made, and:
(A) the member's designated beneficiary is not the member's
current spouse; or
(B) the member has not designated a beneficiary;
the member may make the election described in subsection (c).
(c) A member described in subsection (b) may elect to:
(1) change the member's designated beneficiary or form of
benefit under section 7(b) of this chapter; and
(2) receive an actuarially adjusted and recalculated benefit for
the remainder of:
(A) the member's life; or
(B) the member's life and the life of the newly designated
beneficiary.
(d) A member making the election under subsection (c) may not
elect to change to a five (5) year guaranteed form of benefit under
section 7(b) of this chapter.
(e) If a member elects a benefit under subsection (c)(2)(B), the
member must indicate whether the newly designated beneficiary's
benefit will equal:
(1) the member's full recalculated benefit;
(2) two-thirds (2/3) of the member's recalculated benefit; or
(3) one-half (1/2) of the member's recalculated benefit.
(f) The member bears the cost of recalculating a benefit under
subsection (c)(2), and the cost shall be included in the actuarial
adjustment.
(g) A member may not make the election under subsection (c) if
a final order or property settlement in an action for dissolution of
marriage:
(1) prohibits a change in the member's designated beneficiary;
or
(2) provides a right to a survivor benefit to a person who would
be removed as the designated beneficiary.
(h) Benefits may be recalculated under this section only to the
extent permitted by the Internal Revenue Code and applicable
regulations.
(i) Before implementing this section, the board may obtain any
approvals that the board considers necessary or appropriate from the
Internal Revenue Service.
As added by P.L.149-2007, SEC.2. Amended by P.L.9-2008, SEC.1;
P.L.93-2008, SEC.2.
IC 5-10.2-4-7.5
School corporations participating in Section 401(a) plans;
participation in plan under this chapter
Sec. 7.5. A member may participate in a plan described in
IC 5-10-1.1-1(2) in addition to the plans set forth in this chapter.
As added by P.L.42-1988, SEC.3.
IC 5-10.2-4-8
Reemployment after retirement; when retirement benefits
application void
Sec. 8. (a) Subject to subsection (g), if a member who is receiving
retirement benefits becomes reemployed in a position covered by this
article more than thirty (30) days after the member's retirement, the
member's retirement benefit payments continue.
(b) This subsection applies only to a retired member of the public
employees' retirement fund who, before July 1, 2013, begins a period
of reemployment in a covered position more than thirty (30) days
after the member's retirement. The member shall begin making
contributions as required in IC 5-10.2-3-2, and the member's
employer shall make contributions throughout the member's period
of reemployment.
(c) If a member who is receiving retirement benefits is
reemployed in a position covered by this article not more than thirty
(30) days after the member's retirement, the member's retirement
benefits shall stop, the member shall begin making contributions as
required by IC 5-10.2-3-2, and employer contributions shall be made
throughout the period of reemployment.
(d) This subsection applies only to a retired member of the public
employees' retirement fund who, before July 1, 2013, begins a period
of reemloyment in a covered position more than thirty (30) days after
the member's retirement. If a retired member is reemployed in a
position covered by this article, section 10 of this chapter applies to
the member upon the member's retirement from reemployment.
(e) Subject to subsection (g), and except for a member described
in IC 5-10.2-3-3(a)(2), the following apply to a retired member who
begins a period of reemployment in a covered position more than
thirty (30) days after the member's retirement:
(1) The member's retirement benefit payments continue during
the member's period of reemployment without regard to the
amount of the member's earnings from the covered position.
(2) The member may not make contributions under
IC 5-10.2-3-2, IC 5-10.3-7-9, or IC 5-10.4-4-11 during the
member's period of reemployment.
(3) The member's employer may not make contributions under
IC 5-10.2-2-11, IC 5-10.3-7-9, or IC 5-10.4-4-11 for or on
behalf of the member during the member's period of
reemployment.
(4) The member does not earn creditable service under
IC 5-10.2-3-1 for the member's period of reemployment.
(5) The member is not entitled to an additional benefit under
sections 9 and 10 of this chapter for the member's period of
reemployment.
(f) The thirty (30) day period provided for in this section may be
implemented unless the board receives a determination from the
Internal Revenue Service prohibiting the implementation.
(g) After July 31, 2009, if, on or before the date the member files
an application for retirement benefits under this article, a member
has a formal or informal agreement with an employer covered by this
article to become reemployed in a position covered by this article
after the member's retirement, regardless of the time frame between
the member's retirement and the member's reemployment, the
member's application for retirement benefits is void, and the
following apply to the member's continued employment:
(1) If a member has received a retirement benefit:
(A) the member's retirement benefit shall stop; and
(B) the member shall repay the amount of the retirement
benefit received.
(2) The member shall make contributions as required by
IC 5-10.2-3-2 throughout the period of the member's continued
employment.
(3) Employer contributions shall be made throughout the period
of the member's continued employment.
(4) The member shall earn creditable service under
IC 5-10.2-3-1 for the member's continued employment.
(5) When the period of the member's continued employment
terminates, the member may again file an application for
retirement benefits under this chapter.
As added by Acts 1977, P.L.53, SEC.2. Amended by P.L.49-1985,
SEC.1; P.L.195-1999, SEC.18; P.L.246-2001, SEC.6; P.L.62-2005,
SEC.3; P.L.72-2007, SEC.5; P.L.76-2008, SEC.2; P.L.130-2008,
SEC.1; P.L.115-2009, SEC.8; P.L.35-2012, SEC.45; P.L.195-2013,
SEC.6.
IC 5-10.2-4-8.2
Election, appointment to elected position, or service in other
position covered by this article
Sec. 8.2. (a) Notwithstanding section 8 of this chapter, if a
member who is receiving retirement benefits is elected or appointed
to an elected position covered by this article, the member shall file
a written, irrevocable election with the board to continue or
discontinue retirement benefits while the member holds the elected
position.
(b) If a member:
(1) is elected or appointed to an elected position and:
(A) becomes at least fifty-five (55) years of age; and
(B) completes at least twenty (20) years of service; or
(2) is serving in any other position covered by this article and:
(A) becomes at least seventy (70) years of age; and
(B) completes at least twenty (20) years of service;
while holding the position, the member may file a written,
irrevocable election to begin receiving, while holding the position,
retirement benefits to which the member would be entitled by age
and service. A member who does not make the irrevocable election
while holding the position is entitled to retroactive payments to cover
any period from the date the member qualifies to make the election
under this subsection to the date the member files the election under
this subsection.
(c) The form and content of an election shall be prescribed by the
board. If the member elects to discontinue receiving retirement
benefits, the member shall make contributions as required in
IC 5-10.2-3-2. If the member elects to continue or begin receiving
benefits:
(1) the member may continue to make contributions under
IC 5-10.2-3-2 but is not required to do so; and
(2) the member waives the accrual of service credit and the
right to any supplemental benefit from service in the position,
except to the extent that the value of the accrual of additional
service credit and any supplemental benefit exceeds the
actuarial value of the benefits received under this chapter and
that were continued or begun pursuant to an election under this
section.
(d) Except to the extent of the liability for any additional benefit
accrued under subsection (c)(2), the employer shall make the
employer's contribution only for past service liability based on the
salary for the position of a member who elects under subsection (a)
or (b) to continue or begin receiving retirement benefits.
(e) Section 10 of this chapter applies to a member who elects
under subsection (a) to discontinue receiving retirement benefits.
Section 10 of this chapter does not apply, while the member holds a
position covered by this article, to a member who elects under
subsection (a) or (b) to continue or begin receiving retirement
benefits.
As added by P.L.47-1985, SEC.4. Amended by P.L.60-1989, SEC.1;
P.L.4-1990, SEC.10; P.L.25-1994, SEC.4; P.L.61-2002, SEC.6.
IC 5-10.2-4-8.4
Retirement while serving in elected position
Sec. 8.4. (a) This section does not apply to a member of the
Indiana state teachers' retirement fund who is eligible to retire under
IC 5-10.2-2-8(b).
(b) A member of the Indiana state teachers' retirement fund who:
(1) serves in an elected position; and
(2) after June 30, 2006, makes an election under section 8.2(b)
of this chapter to begin receiving, while the member holds the
elected position or not later than thirty (30) days after the day
on which the member's elected term of office ends, the
retirement benefits to which the member is entitled by age and
service;
may choose at the member's retirement date whether to retire from
the Indiana state teachers' retirement fund or from the public
employees' retirement fund.
(c) If the member described in subsection (b) chooses to retire
from the public employees' retirement fund, that fund is responsible
for the payment of benefits provided under this chapter, and the
Indiana state teachers' retirement fund shall pay to the public
employees' retirement fund:
(1) the amount credited to that member in the annuity savings
account in the Indiana state teachers' retirement fund; and
(2) the proportionate actuarial cost of the member's pension.
As added by P.L.119-2006, SEC.2. Amended by P.L.93-2008, SEC.3.
IC 5-10.2-4-9
Death during reemployment
Sec. 9. (a) This section applies only to a retired member of the
public employees' retirement fund who, before July 1, 2013, begins
a period of reemployment in a covered position more than thirty (30)
days after the member's retirement.
(b) If a member dies during reemployment and retirement benefits
from before the member's reemployment are payable after the
member's death, the payment of these amounts shall be made without
change, and any additional benefit earned during reemployment shall
be paid as provided in section 10 of this chapter.
As added by Acts 1977, P.L.53, SEC.2. Amended by P.L.47-1985,
SEC.5; P.L.246-2001, SEC.7; P.L.72-2007, SEC.6; P.L.76-2008,
SEC.3; P.L.195-2013, SEC.7.
IC 5-10.2-4-10
Benefits after reemployment
Sec. 10. (a) This section applies only to a retired member of the
public employees' retirement fund who, before July 1, 2013, begins
a period of reemployment in a covered position more than thirty (30)
days after the member's retirement.
(b) Benefits provided under this section are subject to
IC 5-10.2-2-1.5.
(c) Upon termination of reemployment, except by death, the
retirement benefits from before the member's reemployment which
are payable after termination shall be paid without change.
(d) If the member is reemployed for fewer than ninety (90)
consecutive school or working days, upon termination of
reemployment, contributions and interest credited to the member's
annuity savings account shall be paid to the member.
(e) If the member is reemployed for ninety (90) or more
consecutive school or working days, upon termination of
reemployment, the member shall receive an additional benefit.
(f) The additional retirement benefit consists of the sum of a
supplemental pension and a supplemental annuity. The supplemental
pension is computed under section 4 of this chapter using the
member's:
(1) years of service during the member's reemployment; and
(2) average compensation during the member's reemployment,
if the member is reemployed for less than five (5) years, or
average of the annual compensation (as defined in section 3 of
this chapter) during the member's reemployment.
If the member is entitled to a supplemental annuity, it consists of an
annuity provided by contributions and interest credited to the
member during reemployment, if any.
(g) The additional retirement benefits are guaranteed for five (5)
years or until the member's death, whichever is later. The member
may choose instead of the guaranteed payments any of the options
under section 7 of this chapter for the payment of the member's
additional retirement benefits.
(h) IC 5-10.2-2-7 applies to additional retirement benefits.
As added by Acts 1977, P.L.53, SEC.2. Amended by P.L.49-1985,
SEC.2; P.L.40-1986, SEC.2; P.L.55-1989, SEC.20; P.L.22-1993,
SEC.3; P.L.25-1994, SEC.5; P.L.246-2001, SEC.8; P.L.72-2007,
SEC.7; P.L.76-2008, SEC.4; P.L.195-2013, SEC.8.
IC 5-10.2-4-10.2
Repealed
(Repealed by P.L.40-1986, SEC.3.)
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