N.J. Admin. Code § 12:17-8.3

Current through Register Vol. 56, No. 11, June 3, 2024

Section 12:17-8.3 - Lump sum pension reduction

(a) In those cases where an individual is the recipient of a lump sum payment from his or her employer in lieu of a periodic payment of a pension, retired or retirement payment, including 401K plans, annuity or other similar periodic payment, the calculation for the reduction of benefits shall be made, consistent with the provisions of 12:17-8.1 and 8.2, by prorating the dollar value of the payment over the life expectancy of the individual at the time of separation from the employer using approved actuarial tables.

(b) The lump sum pension payable to an individual, who is involuntarily and permanently separated from employment prior to the date at which the individual may retire with full pension rights, shall be assigned to the week in which the individual receives the lump sum payment or, at the claimant's option, may be prorated pursuant to (a) above.

1. For purposes of this subsection, the term "involuntarily," when used to describe an individual's separation from employment, shall mean both those instances when an individual has been discharged from employment and those instances when an individual has left work voluntarily with good cause attributable to such work, as the phrase "good cause attributable to such work" is used within 43:21-5.

2. For purposes of this subsection, the phrase "date at which the individual may retire with full pension rights" shall mean the date upon which the claimant has attained the age at which the Internal Revenue Code provides that an individual's receipt of a distribution from a qualified retirement plan is not subject to a 10 percent additional early distribution tax as defined in 26 U.S.C. § 72(t)(2)(A)(i).

N.J. Admin. Code § 12:17-8.3

AAmended by R.2006 d.43, effective 1/17/2006.
See: 37 New Jersey Register 3545(a), 38 New Jersey Register 819(a).
In (b), substituted "with full pension rights" for "without penalty to his or her pension rights" and added (b)1 and 2.