§ 2-84. Compliance with the Internal Revenue Code.

(a)

It is the intention of the city and of the board that the plan remain at all times a qualified plan, as that term is defined under the Internal Revenue Code.

(b)

No member's annual benefit shall exceed the amounts permitted in Section 415 of the Internal Revenue Code.

(c)

In no event may a member's retirement benefit be delayed beyond the later of April 1 following the calendar year in which the member attains age seventy and one-half (70½), or April 1st of the year following the calendar year in which the member retires.

When a distribution of the participant's entire interest is not made in a lump sum, the distribution will be made in or more of the following ways: over the life of the participant; over the life of the participant and designated beneficiary; over a period certain not extending beyond the life expectancy of the participant; or over a period certain not extending beyond the joint life and last survivor expectancy of the participant and a designated beneficiary.

(d)

If the distribution has commenced before the participant's death, the remaining interest will be distributed at least as rapidly as under the method of distribution being used as of the date of the participant's death.

The method of distribution, if the participant dies before distribution is commenced, must satisfy the following requirements:

(1)

Any remaining portion of the participant's interest that is not payable to a beneficiary designated by the participant will be distributed within five (5) years after the participant's death;

(2)

Any portion of the participant's interest that is payable to a beneficiary designated by the participant will be distributed either: (i) within five (5) years after the participant's death; or (ii) over the life of the beneficiary, or over a period certain not extending beyond the life expectancy of the beneficiary, commencing not later than the end of the calendar year following the calendar year in which the participant died (or, if a designated beneficiary is the participant's surviving spouse, commencing not later than the end of the calendar year following the calendar year in which the participant would have attained age seventy and one-half (70½)).

(e)

Direct transfers of eligible distributions shall be made as follows:

(1)

General. This subsection applies to distributions made on or after January 1, 1993. Notwithstanding any provision of the plan to the contrary that would otherwise limit a distributee's election under this subsection, a distributee may elect, at the time and in the manner prescribed by the board, to have any portion of an eligible rollover distribution made directly to an eligible retirement plan specified by the distributee in a direct rollover.

(2)

Definitions.

a.

Eligible rollover distribution. An eligible rollover distribution is any distribution of all or any portion of the balance to the credit of a distributee, except that an eligible rollover distribution does not include: any distribution that is one (1) of a series of a 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 ten (10) years or more; any distribution to the extent such distribution is required under Section 401(a)(9) of the Internal Revenue Code; and the portion of any distribution that is not includable in gross income.

b.

Eligible retirement plan. An eligible retirement plan is an individual retirement account described in Section 408(a) of the Internal Revenue Code, an individual retirement annuity described in Section 408(b) of the Internal Revenue Code, an annuity plan described in Section 403(a) of the Internal Revenue Code, or a qualified trust described in Section 401(a) of the Internal Revenue Code that accepts a distributee's eligible rollover distribution. However, in the case of an eligible rollover distribution to a surviving spouse, an eligible retirement plan is an individual retirement account or individual retirement annuity.

c.

Distributee. A distributee includes an employee or former employee. In addition, the employee's or former employee's surviving spouse is a distributee with regard to the interest of the spouse.

d.

Direct rollover. A direct rollover is a payment by the plan to the eligible retirement plan specified by the distributee.

(f)

Notwithstanding any provision in this part to the contrary, the chief of police, if eligible for an unreduced normal retirement and opts out of any future participation as an active member of the plan, may receive an in service distribution provided the terms of any such distribution are consistent with the provisions of the Internal Revenue Code and corresponding regulations of the Department of the Treasury.

(Ord. No. 00O-3-15, § 2, 5-8-00; Ord. No. 00O-12-85, § 1, 12-18-00; Ord. No. 16O-06-121, § 2, 6-27-16)