Or. Admin. Code § 459-007-0050

Current through Register Vol. 63, No. 10, October 1, 2024

Section 459-007-0050 - Crediting Earnings for a Deceased Tier One Active or Inactive Member

Upon the death of an active or inactive Tier One member, earnings from the date of death to the date of distribution shall be credited as specified in this rule.

(1) Definitions. For purposes of this rule:

(a) "Death benefit amount" means the sum of the member's regular account and variable account as of the first of the month of the member's death and held by PERS for the beneficiary or beneficiaries of a deceased member until benefits are distributed.

(b) "Effective date of request" means the first of the month in which PERS receives a valid request for distribution of the death benefit amount.

(2) For a member whose date of death is on or after January 1, 2000:

(a) If the member's death is before July 1, 2003, earnings shall be credited to the member's regular account as follows:

(A) If earnings for the calendar year before the date of the member's death have not yet been credited, earnings for that year shall be credited based on the greater of the assumed rate or the latest year-to-date calculation available for that year.

(B) Earnings for the calendar year of the member's death shall be credited based on the greater of the assumed rate, prorated from January 1 to the first of the month of the member's death, or the latest year-to-date calculation as of the first of the month of the member's death.

(b) If the member's death is on or after July 1, 2003, earnings shall be credited to the member's regular account as follows:

(A) If earnings for the calendar year before the date of the member's death have not yet been credited, earnings for that year shall be credited based on the latest year-to-date calculation available for that year.

(B) Earnings for the calendar year of the member's death shall be credited based on the latest year-to-date calculation as of the first of the month of the member's death.

(c) If the member was participating in the Variable Annuity Account, earnings shall be credited to the member's variable account as follows:

(A) If earnings for the calendar year before the calendar year of the member's death have not yet been credited, earnings for that year shall be credited based on the latest year-to-date calculation available for that year.

(B) Earnings for the calendar year of the member's death shall be credited based on the latest year-to-date calculation as of the first of the month of the member's death.

(d) After earnings have been credited in accordance with subsections (a), (b) and (c), the value of the member's variable account shall be added to the value of the member's regular account and the sum shall constitute the death benefit amount as of the first of the month of the member's death.

(e) If the effective date of request occurs within the same year as the date of death, earnings from the first of the month of the member's death to the effective date of request shall be credited based on the latest year-to-date calculation for Tier Two regular accounts as of the effective date of request less the latest year-to-date calculation for Tier Two regular accounts as of the first of the month of the member's death, and subsections (f) through (h) of this section do not apply.

(f) Earnings on the death benefit amount from the first of the month of the member's death to the end of the calendar year shall be credited based on the Tier Two annual rate less the latest year-to-date calculation for Tier Two as of the first of the month of the member's death.

(g) Earnings on the death benefit amount for calendar years following the year of the member's death and before the year funds are requested shall be credited in accordance with OAR 459-007-0005 for Tier Two regular accounts.

(h) Earnings on the death benefit amount from January 1 of the year funds are requested to the effective date of request shall be based on the latest year-to-date calculation for Tier Two regular accounts.

(i) Earnings from the effective date of request to the date of distribution shall be based on the average annualized rate.

(3) If a member's date of death is before July 1, 2003, and the effective date of request is before December 31, 2004, earnings shall be credited as follows:

(a) Earnings from the date of death through December 31, 1999, shall be credited to the member's regular account as of December 31, 1999, in accordance with the provisions of this rule in effect from the date of death through December 31, 1999.

(b) Earnings from January 1, 2000, to the date of distribution shall be credited in accordance with ORS 238.390 as simple interest prorated for that period based on the assumed rate.

(4) If a member's date of death is before January 1, 2000, but the effective date of request is on or after December 31, 2004, earnings shall be credited as follows:

(a) Earnings shall be credited in accordance with the version(s) of OAR 459-007-0050 in effect up to January 1, 2000.

(b) As of January 1, 2000, the deceased member's account(s) shall be converted to a death benefit amount under subsection (2)(d) of this rule.

(c) Earnings on the death benefit amount from January 1, 2000, to the date of distribution shall be credited in accordance with subsections (2)(e) through (2)(h) of this rule.

(5) If a beneficiary elects a monthly payment, earnings shall be credited to the death benefit amount from the first of the month of the member's date of death to the effective date of the monthly payment, which is the first of the month following the member's date of death, as follows:

(a) Subtract the latest Tier Two regular account year-to-date calculation available as of the first of the month of the member's death, from the latest Tier Two regular account year-to-date calculation available as of the effective date of the monthly payment.

(b) Multiply the beneficiary's death benefit amount as of the first of the month of the member's death by the rate calculated in subsection (a) of this section.

(6) The provisions of this rule are effective on July 1, 2003.

Or. Admin. Code § 459-007-0050

PER 8, f. 12-15-55; PER 4-1980(Temp), f. 11-26-80, ef. 12-1-80; PER 1-1984(Temp), f. & ef. 6-29-84; PER 2-1984(Temp), f. & ef. 9-26-84; PER 1-1985, f. & ef. 3-22-85; PERS 1-1995, f. 9-12-95, cert. ef. 1-1-96; PERS 1-1996, f. & cert. ef. 3-26-96; Renumbered from 459-010-0135(6); PERS 9-1998, f. 5-22-98, cert. ef. 1-1-00; PERS 1-2000, f. & cert. ef. 1-7-00; PERS 4-2003(Temp), f. 6-13-03, cert. ef. 7-1-03 thru 12-26-03; PERS 24-2003, f. & cert. ef. 12-15-03; PERS 16-2004, f. & cert. ef. 6-15-04; PERS 21-2005, f. & cert. ef. 11-1-05; PERS 3-2009, f. & cert. ef. 4-6-09

Stat. Auth.: ORS 238.650

Stats. Implemented: ORS 238.390, 238.430 & 238.435