La. Admin. Code tit. 32 § VII-705

Current through Register Vol. 50, No. 8, August 20, 2024

Section VII-705 - In-Service Distributions

A. Voluntary In-Service Distribution of De Minimis Accounts. A participant who is an active employee shall receive a distribution of the total amount payable to the participant under the plan if the following requirements are met:

1. the portion of the total amount payable to the participant under the plan does not exceed an amount specified from time to time by the commission (not in excess of $5,000 or other applicable limit under the Internal Revenue Code);

2. the participant has not previously received an in-service distribution of the total amount payable to the participant under the plan;

3. no amount has been deferred under the plan with respect to the participant during the two-year period ending on the date of the in-service distribution; and

4. the participant elects to receive the distribution.

B. Involuntary In-Service Distribution of De Minimis Accounts. Upon notice to participants, and subject to LAC 32:VII.721.A, the commission may establish procedures under which the plan shall distribute the total amount payable under the plan to a participant who is an active employee if the following requirements are met:

1. the portion of the total amount payable to the participant under the plan does not exceed an amount specified from time to time by the commission (not in excess of $1,000 or other applicable limit under the Internal Revenue Code);

2. the participant has not previously received an in-service distribution of the total amount payable to the participant under the plan; and

3. no amount has been deferred under the plan with respect to the participant during the two-year period ending on the date of the in-service distribution.

C. Participants in the plan providing FICA replacement retirement benefits pursuant to regulations under Code §3121(b)(7)(F) are not eligible for In-Service De Minimus distributions.

D. Purchase of Defined Benefit Plan Service Credit

1. If a participant is also a participant in a defined benefit governmental plan [as defined in IRC §414(d)], such participant may request the commission to transfer amounts from his or her account for:

a. the purchase of permissive service credit [as defined in IRC §415(n)(3)(A)] under such plan; or

b. a repayment to which IRC §415 does not apply by reason of IRC §415(k)(3)

2. Such transfer requests shall be granted in the sole discretion of the commission, and if granted, shall be made directly to the defined benefit governmental plan.

La. Admin. Code tit. 32, § VII-705

Promulgated by the Department of the Treasury, Deferred Compensation Commission, LR 24:1967 (October 1998), amended LR 28:1497 (June 2002), LR 32:121 (January 2006).

AUTHORITY NOTE: Promulgated in accordance with R.S. 42:1301-1308 and IRC §457.