2006 Louisiana Laws - RS 11:1457 — Qualified plan; direct rollover; eligible retirement plan; election

§1457.  Qualified plan; direct rollover; eligible retirement plan; election

A.  Notwithstanding any other provision of law to the contrary that would otherwise limit a state or statewide retirement system member's election under this Section, a distributee may elect, at the time and in the manner prescribed by the plan administrator, 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.  If a distribution is one to which Sections 401(a)(11) and 417 of the Internal Revenue Code do not apply, such distribution may commence less than thirty days after the notice required under Section 1.411(a)-11(c) of the Income Tax Regulations is given, provided that:

(1)  The plan administrator clearly informs the participant that the participant has a right to a period of at least thirty days after receiving the notice to consider the decision of whether or not to elect a distribution and, if applicable, a particular distribution option, and

(2)  The participant, after receiving the notice, affirmatively elects a distribution.

C.  As used in this Section, the following terms shall mean the following:

(1)  "Direct rollover" means a payment by the plan to the eligible retirement plan specified by the distributee.

(2)  "Distributee" means a member or former member.  In addition, the member's or former member's surviving spouse, or the member's spouse or former member's spouse with whom a benefit or return of employee contributions is to be divided pursuant to R.S. 11:291(B) are distributees with reference to an interest of the member or former spouse.

(3)  "Eligible retirement plan" means an individual retirement account described in Section 408(a) of the Internal Revenue Code, an individual retirement annuity described in Section 408(b) of the Internal Revenue Code, an annuity plan described in Section 403(a) of the Code, or a qualified trust described in Section 401(a) of the Internal Revenue Code, that accepts the distributee's eligible rollover distribution.  However, in the case of an eligible rollover distribution to the surviving spouse, an eligible retirement plan is an individual retirement account or individual retirement annuity.  "Eligible retirement plan" shall also mean an annuity contract described in Section 403(b) of the Internal Revenue Code and an eligible plan under Section 457(b) of the Internal Revenue Code which is maintained by a state, a political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state agreeing to account separately for amounts transferred into such plan from this fund.  A distribution to a surviving spouse or to a spouse or former spouse who is the alternate payee under a qualified domestic relations order shall not make the retirement plan ineligible.

(4)  "Eligible rollover distribution" means any distribution of all or any portion of the balance to the credit of the distributee, except that an eligible rollover distribution does not include: any distribution that is one of a series of substantially 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 Internal Revenue Code; and the portion of any distribution that is not includable in gross income, determined without regard to the exclusion for net unrealized appreciation with respect to employer securities.  A portion of a distribution shall not fail to be an eligible rollover distribution merely because the portion consists of after-tax employee contributions which are not includable in gross income; however, such portion may be paid only to an individual retirement account or annuity described in Section 408(a) or (b) of the Internal Revenue Code, or to a qualified defined contribution plan described in Section 401(a) or 403(a) of the Internal Revenue Code that agrees to account separately for amounts so transferred, including accounting separately for the portion of such distribution which is includable in gross income and the portion of such distribution which is not includable.  The fund shall accept participant rollover contributions, direct rollovers of distributions made after December 31, 2001, or both, from the following types of plans:  individual retirement accounts or annuities or plans qualified under Section 401(a) or Section 403(a) of the Internal Revenue Code, or governmental deferred compensation arrangements subject to Section 457(b) of the Internal Revenue Code or tax sheltered annuities or other arrangements under Section 403(b) of the Internal Revenue Code, beginning on the effective date specified; but only for the purposes of repaying prior distributions or purchasing service credits as permitted under Section 415(k)(3) and Section 415(n) of the Internal Revenue Code.

Acts 1997, No. 689, §1, eff. retroactive to Jan. 1, 1993; Acts 2004, No. 794, §1.