A. To purchase Service Credit using
Termination Pay, an Eligible Member shall elect to use Termination Pay by the
date payment election is due.
B.
Upon receipt of the documentation required by this
Article from the eligible member and if the eligible member's request to
purchase service credit meets the requirements of this Article, the ASRS shall
provide a:
1.
SP invoice stating the cost to purchase the
requested amount of service credit and the date the payment is due,
and
2.
Service Purchase Payment Request form as described
in
R2-8-502(D)(2) .
B. An Eligible Member who elects to use
Termination Pay pursuant to this section, shall provide the ASRS with the
Eligible Member's anticipated termination date which cannot be more than six
months from the date the ASRS issues the SP Invoice and must be at least Three
Full Calendar Months after the date the Eligible Member elects and submits
Termination Pay as a method of payment.
C.
By the due date specified on the SP invoice, the
member shall ensure that the ASRS receives the completed Service Purchase
Payment Request form.
D.
C. An Eligible Member
who elects to use Termination Pay pursuant to this section, shall provide the
ASRS with a Termination Pay Authorization for the Purchase of Service Credit
form with the following information:
1.
Member's full name,
2.
Member's Social Security number,
3.
Member's daytime telephone number,
4.
The Request ID number listed on the SP
invoice,
5.
1. The name of the Employer that will be submitting
the Termination Pay to the ASRS;
6.
2. Whether the Eligible
Member elects to use all Termination Pay or a specific amount of Termination
Pay;
7.
3. Signature of the Eligible Member, certifying that
the Eligible Member understands that:
a. The
Eligible Member is required to continue working at least Three Full Calendar
Months after the date the Eligible Member submits the Termination Pay
Authorization for the Purchase of Service Credit form before Termination Pay
may be used on a pre-tax basis;
b.
If the Eligible Member terminates employment more than six months after the
date on the SP Invoice, the Eligible Member may purchase the Service Credit at
a newly calculated rate and possibly at a higher cost;
c. The terms elected in the Termination Pay
Authorization for the Purchase of Service Credit form are binding and
irrevocable;
d. The Eligible
Member's Employer is required to make payment directly to the ASRS after
mandatory deductions are made, and the Eligible Member does not have the option
of receiving the funds directly from the Employer;
e. The Eligible Member's Termination Pay must
be received and processed before the ASRS will accept any other form of
payment;
f.
If the member elects to purchase with termination
pay only a portion of the service credit that the member is entitled to
purchase, the member may be eligible to use other forms of payment to purchase
additional service credit. However, using other forms of payment to purchase
additional service credit does not alter, amend, or revoke the terms of the
Termination Pay Authorization for the Purchase of Service Credit
form;
g.
f. It is the Eligible Member's responsibility to
ensure that the Eligible Member's Employer properly deducts Termination Pay, as
provided in the Termination Pay Authorization for the Purchase of Service
Credit form; and
h.
g. The amount of Termination Pay the Eligible Member
elects is irrevocable pursuant to § 414(h)(2) of the IRC;
h. If the Termination Pay exceeds the balance
due on the SP Invoice, the ASRS will return the difference to the Eligible
Member's Employer to be distributed to the Eligible Member;
i. If the Eligible Member terminates
employment and immediately retires, the Eligible Member's retirement processing
may be delayed; and
j. The ASRS
will send a notification to the Eligible Member's Employer two weeks prior to
the Eligible Member's termination date, as indicated on the Termination Pay
Authorization form, to notify the Employer that the Eligible Member's
Termination Pay must be sent directly to the ASRS.
E.
In addition to the other time limitations in this
Section, to apply termination pay to a service purchase the eligible member
shall complete and sign the Termination Pay Authorization for the Purchase of
Service Credit form, and the member shall ensure that the ASRS receives the
Termination Pay Authorization for the Purchase of Service Credit form at least
three full calendar months before the member retires or terminates
employment.
F.
D. The ASRS shall not
apply Termination Pay to an SP Invoice covered by an Irrevocable PDA in effect
at the time of termination, unless the Eligible Member elected the Termination
Pay pursuant to
R2-8-513(D)
at the time the member authorized the Irrevocable PDA.
G.
E. If
an Eligible Member elects to use Termination Pay to purchase Service Credit,
the ASRS shall not apply any other form of payment to the Service Credit
purchase until the ASRS receives the Termination Pay.
F. Notwithstanding any other section, if an
Eligible Member dies prior to terminating employment, the ASRS shall not accept
Termination Pay.
G. If an Eligible
Member Transfers Employment, the ASRS shall not accept Termination Pay from the
Eligible Member's previous Employer.
Notes
Ariz. Admin. Code §
R2-8-519
New Section made by
final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2).
Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006
(Supp. 06-4). Amended by final rulemaking at
25
A.A.R. 303, effective 3/18/2019.
