Okla. Admin. Code § 590:35-13-10

Current through Vol. 42, No. 4, November 1, 2024

Section 590:35-13-10 - Minimum distribution requirements

(a) Notwithstanding anything herein to the contrary, the following minimum distribution requirements will apply.

(b) All distributions required under this Section shall be determined and made in accordance with Code Section 401(a)(9) and the proposed Treasury Regulations thereunder, including the minimum distribution incidental benefit requirement of Code Section 401(a)(9)(G) and Section 1.401(a)(9)-2 of the proposed Treasury Regulations, or any successor rules or regulations.

(c) The entire interest of a Participant must be distributed or begin to be distributed no later than the Participant's Required Beginning Date.

(d)Limits on Distribution Periods. As of the first Distribution Calendar Year, distributions, if not made in a single lump sum, may be made over one of the following periods (or a combination thereof):

(1) the life of the Participant,

(2) the life of the Participant and a designated Beneficiary

(3) a period certain not extending beyond the Life Expectancy of the Participant, or

(4) a period certain not extending beyond the joint and last survivor expectancy of the Participant and a designated Beneficiary.

(e) If the Participant's interest is to be distributed in other than a single lump sum, the following minimum distribution rules shall apply on or after the Required Beginning Date:

(1) If a Participant's benefit is to be distributed over (i) a period not extending beyond the life expectancy of the Participant or the joint life and last survivor expectancy of the Participant and the Participant's designated Beneficiary or (ii) a period not extending beyond the life expectancy of the designated Beneficiary, the amount required to be distributed for each calendar year, beginning with distributions for the first Distribution Calendar Year must at least equal the quotient obtained by dividing the Participant's benefit by the Applicable Life Expectancy.

(2) The amount to be distributed each year, beginning with distributions for the first Distribution Calendar Year shall not be less than the quotient obtained by dividing the Participant's benefit by lesser of

(A) the Applicable Life Expectancy or

(B) if the Participant's Spouse is not the designated Beneficiary, the applicable divisor determined from the table set forth in Q&A-4 of Section 1.401(a)(9)-2 of the proposed Treasury Regulations. Distributions made after the death of the Participant shall be distributed using the Applicable Life Expectancy in (1) above as the relevant divisor without regard to proposed Treasury Regulations Section 1.401(a)(9)-2.

(3) The minimum distribution required for the Participant's first Distribution Calendar Year must be made on or before the Participant's Required Beginning Date. The minimum distribution for other calendar years, including the minimum distribution for the Distribution Calendar Year in which the Participant's Required Beginning Date occurs, must be made on or before December 31 of that Distribution Calendar Year.

(f) If the Participant's benefit is distributed in the form of an annuity purchased from an insurance company, distributions thereunder shall be made in accordance with the requirements of Code Section 401(a)(9) and the proposed Treasury Regulations thereunder.

(g) For purposes of this Section, the following terms shall have the meanings as set forth below:

(1)"Applicable Life Expectancy" means the life expectancy (or joint and last survivor expectancy) calculated using the attained age of the Participant (or designated Beneficiary) as of the Participant's (or designated Beneficiary's) birthday in the applicable calendar year reduced by one for each calendar year which has elapsed since the date life expectancy was first calculated. Life expectancies will not be recalculated annually. If annuity payments commence before the Required Beginning Date, the applicable calendar year is the year payments commence. If distribution is in the form of an immediate annuity purchased after the Participant's death with the Participant's remaining interest, the applicable calendar year is the year of purchase.

(2)"Distribution Calendar Year" means a calendar year for which a minimum distribution is required. For distributions beginning before the Participant's death, the first Distribution Calendar Year is the calendar year immediately preceding the calendar year which contains the Participant's Required Beginning Date. For distributions beginning after the Participant's death, the first Distribution Calendar Year is the calendar year in which distributions are required to begin pursuant to this Section.

(3)"Participant's Benefit" means the Participant's Account as of the last Valuation Date in the calendar year immediately preceding the Distribution Calendar Year ("Valuation Calendar Year") increased by the amount of any contributions allocated to the Account as of dates in the Valuation Calendar Year after the Valuation Date and decreased by distributions made in the Valuation Calendar Year after the Valuation Date. If any portion of the minimum distribution for the first Distribution Calendar Year is made in the second Distribution Calendar Year on or before the Required Beginning Date, the amount of the minimum distribution made in the second Distribution Calendar Year shall be treated as if it has been made in the immediately preceding Distribution Calendar Year.

(4)"Required Beginning Date" means the later of the first day of April of the calendar year following the calendar year in which the Participant

(A) attains age 72 or such other date as may be permitted by the federal Internal Revenue Code or

(B) retires.

Okla. Admin. Code § 590:35-13-10

Added at 15 Ok Reg 793, eff 11-12-97 (emergency); Added at 15 Ok Reg 3282, eff 7-13-98; Amended at 16 Ok Reg 617, eff 12-2-98 (emergency); Amended at 16 Ok Reg 2019, eff 6-11-99

Amended by Oklahoma Register, Volume 38, Issue 24, September 1, 2021, eff. 9/11/2021