RULE 088.00.03-006 - Revision of ATRS Policies & Forms - Qualified Domestic Relations Orders

RULE 088.00.03-006. Revision of ATRS Policies & Forms - Qualified Domestic Relations Orders

QUALIFIED DOMESTIC RELATIONS ORDERS FOR ACTIVE MEMBERS (Act 1143 of 1993; ACT 644 OF 1995)

DEFINITIONS

"Alternate payee" means a spouse, former spouse, child or other dependent of a participant under Arkansas law.

POLICIES

1. The qualified domestic relations order of the chancery court is authorized to specify a designated percent of a fractional interest on any retirement benefit payment that may be paid to an alternate payee.

2. Qualified domestic relations orders issued by a chancery court of the State of Arkansas and which apply to a participant of the Teacher Retirement System (retirement plan) shall be accepted by the system, subject to the following restrictions:

(a) Benefits to the alternate payee shall begin when the participant retires, or ceases employment in a covered position and receives a refund of contributions.

(b) Pursuant to Act 1143 of 1993, a model qualified domestic relations order is added as Addendum A to these policies. Any qualified domestic relations order issued by a chancery court of Arkansas must comply with the content of and substantially follow the form set out in the addendum.

(c) When a qualified domestic relations order is received by the retirement plan,

(1) the plan administrator shall promptly notify the participant and the alternate payee of the receipt of such order, and

(2) within a reasonable time after receipt of the order, determine whether the order is a qualified domestic relations order as set out in Addendum A to these policies and notify the participant and the alternate payee of such determination.

(d) Qualified domestic relations orders received prior to a participant's retirement or cessation of employment will be handled as set out in (c) above, but any amounts payable to the alternate payee will be held in the participant's account until due to be paid.

(e) Nothing contained in the qualified domestic relations order shall be construed to require the retirement plan to provide an alternate payee any type or form of benefit or option not otherwise available to the participant; to provide the alternate payee actuarial benefits not available to the participant; or to pay any benefits to the alternate payee which are required to be paid to another alternate payee under a previous qualified domestic relations order.

(f) Should the alternate payee die prior to the receipt of benefits under the qualified domestic relations order, the entire amount due the alternate payee shall revert to the participant.

(g) Should the participant die prior to retirement, the alternate payee shall receive the same percentage of the participant's contributions, if any, as was awarded by the court in dividing the marital property. In no case shall the alternate payee receive monthly benefits from the retirement plan.

(h) Monthly benefits paid the alternate payee shall be computed on the benefit formula in effect at the time of the participant's retirement, but shall include only service credit earned by the participant during the marital relationship.

(i) The retirement plan shall have the right to make any necessary correction to the monthly benefit amount paid both to the participant and the alternate payee and to recover from either, or both, any overpayments made.

(j) If the alternate payee fails at any time to notify the retirement plan of any mailing address change, the retirement plan shall not be eligible for failure to make the payments as due.

(k) Should the retirement plan determine that the alternate payee's monthly benefits are less than $20.00, the participant shall be paid the total benefit due and shall be responsible for paying the alternate payee the amount due.

(l) Qualified domestic relations order received by the retirement plan before the effective date of Act 1143 of 1993 may be honored but only if the participant or the alternate payee notifies the plan, and it is determined that the order is a qualified order as set out in Addendum A.

ADDENDUM A

QUALIFIED DOMESTIC RELATIONS ORDERS FOR RETIRED MEMBERS (Act 1143 of 1993; Act 644 of 1995)

DEFINITIONS

"Alternate payee" means a spouse, former spouse, child or other dependent of a participant under Arkansas law.

POLICIES

1. The qualified domestic relations order of the chancery court is authorized to specify a designated percent of a fractional interest on any retirement benefit payment that may be paid to an alternate payee.

2. Qualified domestic relations orders issued by a chancery court of the State of Arkansas and which apply to a participant of the Teacher Retirement System (retirement plan) shall be accepted by the system, subject to the following restrictions:

(a) Pursuant to Act 1143 of 1993, a model qualified domestic relations order is added as Addendum A to these policies. Any qualified domestic relations order issued by a chancery court of Arkansas must comply with the content of and substantially follow the form set out in the addendum.

(b) When a qualified domestic relations order is received by the retirement plan,

(1) the plan administrator shall promptly notify the participant, and the alternate payee of the receipt of such order, and

(2) within a reasonable time after receipt of the order, determine whether the order is a qualified domestic relations order as set out in Addendum A to these policies and notify the participant and the alternate payee of such determination.

(c) Nothing contained in the qualified domestic relations order shall be construed to require the retirement plan to provide an alternate payee any type or form of benefit or option not otherwise available to the participant; to provide the alternate payee actuarial benefits not available to the participant; or to pay any benefits to the alternate payee which are required to be paid to another alternate payee under a previous qualified domestic relations order.

(d) Should the alternate payee die prior to the receipt of benefits under the qualified domestic relations order, the entire amount due the alternate payee shall revert to the participant.

(e) Should the participant die prior to retirement, the alternate payee shall receive the same percentage of the participant's contributions, if any, as was awarded by the court in dividing the marital property. In no case shall be the alternate payee receive monthly benefits from the retirement plan.

(f) The retirement plan shall have the right to make any necessary correction to the monthly benefit amount paid both to the participant and the alternate payee and to recover from either, or both, any overpayments made.

(g) If the alternate payee fails at any time to notify the retirement plan of any mailing address change, the retirement plan shall not be liable for failure to make the payments as due.

(h) Should the retirement plan determine that the alternate payee's monthly benefits are less than $20.00, the participant shall be paid the total benefit due and shall be responsible for paying the alternate payee the amount due.

(i) Qualified domestic relations order received by the retirement plan before the effective date of Act 1143 of 1993 may be honored but only if the participant or the alternate payee notifies the plan, and it is determined that the order is a qualified order as set out in Addendum A.

(j) During any period while it is being determined if the order is a qualified domestic relations order, the plan administrator shall separately account for the amounts which would have been payable to the alternate payee during that time.

(k) If a participating member rescinds his or her retirement, the monthly benefit for both the member and the alternate payee shall cease. Benefits for the member and the alternate payee shall resume when the member subsequently retires, or ceases employment in a covered position or receives a refund of contributions.

ADDENDUM A

AUTHORITY: Act 1143 of 1993; Act 644 of 1995 (A.C.A. ยงยง 9-18-101 - 103)

ADOPTED: August 10, 1993

AMENDED: March 6, 1996; February 10, 1998; May 5, 1998; October 7, 2003

(10/8/2003)

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