Section 881.115 - Exemption of retirement allowance(a) The retirement allowance and the contributions of members to the fund, all contributions returned to contributors under the provisions of this act and the moneys in the fund created by this act, shall be exempt from any State or municipal tax and shall be unassignable except to a beneficiary.(b) Rights under this act shall be subject to all of the following:(1) Attachment in favor of an alternate payee as set forth in an approved domestic relations order.(2) Forfeiture as provided by the act of July 8, 1978 (P.L. 752, No. 140), known as the "Public Employee Pension Forfeiture Act." Forfeitures under this clause or under any other provision of law may not be applied to increase the benefits that any member would otherwise receive under this act.(c) Notwithstanding any other provision of this section, a distributee may elect, at the time and in the manner prescribed by the board, to have any portion of an eligible rollover distribution paid directly to an eligible retirement plan utilizing a direct rollover.(d) For purposes of this section, the following words shall have the following meanings: "Distributee." A member, a member's surviving spouse or a member's former spouse who is an alternate payee under an approved domestic relations order.
"Eligible retirement plan."
(1) Except as provided under clause (2), the term shall have the meaning given to it in section 402(c)(8)(B) of the Internal Revenue Code.(2) The term shall include a qualified trust in section 402(c)(8)(B)(iii) of the Internal Revenue Code only if the qualified trust accepts the distributee's eligible rollover distribution. If the eligible rollover distribution is made to a nonspousal beneficiary, an eligible retirement plan shall be deemed an "individual retirement account" or an "individual retirement annuity" as defined in section 408(a) and (b) of the Internal Revenue Code."Eligible rollover distribution." The term shall have the meaning given to it in section 402(f)(2)(A) of the Internal Revenue Code.
1974, Feb. 1, P.L. 34, No. 15, § 115, effective in 90 days. Affected 1978, April 28, P.L. 202, No. 53, § 2(a)[1464], effective June 27, 1978. Amended 2010, July 9, P.L. 434, No. 56, § 8, imd. effective.