[Added 6-19-2006 by Ord. No. 12-2006]
A. Notwithstanding any provision of the plan to the contrary
that would otherwise limit a distributee's election under this section,
a distributee may elect, at the time and in the manner prescribed
by the Plan Administrator, to have any portion of an eligible rollover
distribution that is equal to at least $500 paid directly to an eligible
retirement plan specified by the distributee in a direct rollover.
B. This §
60-101.1B shall apply to distributions made on or after January 1, 2006. Notwithstanding any provision of the plan to the contrary that would otherwise limit a distributee's election under this section, if a distribution in excess of $1,000 is made and the distributee does not make an election under §
60-101.1A and does not elect to receive the distribution directly, the Plan Administrator shall make such transfer to an individual retirement plan of a designated trustee or issuer pursuant to § 60-104A(9). The Plan Administrator shall notify the distributee in writing, within a reasonable period of time and as otherwise prescribed by law, that the distribution may be transferred to another individual retirement plan.
C. For purposes of this section, the following definitions
shall apply:
(1)
"Eligible rollover distribution" is any distribution
of all or any portion of the balance to the credit of the distributee,
except that an eligible rollover distribution does not include: any
distribution that is one of a series of substantially equal periodic
payments (not less frequently than annually) made for the life or
(life expectancy) of the distributee or the joint lives (or joint
life expectancies) of the distributee and the distributee's designated
beneficiary, or for a specified period of 10 years or more; any distribution
to the extent such distribution is required under Code § 401(a)(9);
and the portion of any distribution that is not includible in gross
income (determined without regard to the exclusion for net unrealized
appreciation with respect to employer securities). For purposes of
the direct rollover provisions in this section of the plan, a portion
of the distribution shall not fail to be an eligible rollover distribution
merely because the portion consists of after-tax employee contributions
that are not includible in gross income. However, such portion may
only be paid to an individual retirement account or annuity described
in § 408(a) or (b) of the Code, or to a qualified defined
contribution plan described in § 401(a) or 403(a) of the
Code that agrees to separately account for amounts so transferred,
including separately accounting for the portion of such distribution
which is includible in gross income and the portion which is not includible.
(2)
"Eligible retirement plan" is a qualified trust
described in Code § 401(a), an individual retirement account
described in Code § 408(a), an individual retirement annuity
described in Code § 408(b), an annuity plan described in
Code § 403(a), an annuity contract described in Code § 403(b),
an eligible deferred compensation plan described in Code § 457(b),
which is maintained by a state, political subdivision of a state,
and any agency or instrumentality of a state or a political subdivision
of a state and which agrees to separately account for amounts transferred
into such plan from this plan.
(3)
"Distributee" includes an employee or former
employee. In addition, the employee's or former employee's surviving
spouse and the employee's or former employee's spouse or former spouse
who is the alternate payee under a qualified domestic relations order,
as defined in Code § 414(p), are distributees with regard
to the interest of the spouse or former spouse.
(4)
"Direct rollover" is a payment by the plan to
the eligible retirement plan specified by the distributee or the Plan
Administrator, if the distributee does not make an election.