CHAPTER 4. RETIREMENT AND DISABILITY BENEFITS
IC 5-10.2-4
Chapter 4. Retirement and Disability Benefits
IC 5-10.2-4-1
Eligibility for normal and early retirement
Sec. 1. (a) This subsection applies to:
(1) members of the public employees' retirement fund whoretire before July 1, 1995; and
(2) members of the Indiana state teachers' retirement fund whoretire before May 2, 1989.
A member who has reached age sixty-five (65) and has at least ten(10) years of creditable service is eligible for normal retirement.
(b) This subsection applies to members of the Indiana stateteachers' retirement fund who retire after May 1, 1989, and tomembers of the public employees' retirement fund who retire afterJune 30, 1995, except as provided in section 1.7 of this chapter. Amember is eligible for normal retirement if:
(1) the member is at least sixty-five (65) years of age and has atleast ten (10) years of creditable service;
(2) the member is at least sixty (60) years of age and has at leastfifteen (15) years of creditable service; or
(3) the member's age in years plus the member's years of serviceis at least eighty-five (85) and the member is at least fifty-five(55) years of age.
(c) A member who has reached age fifty (50) and has at leastfifteen (15) years of creditable service is eligible for early retirementwith a reduced pension.
(d) A member who is eligible for normal or early retirement isentitled to choose a retirement date on which the member's benefitbegins if the following conditions are met:
(1) The application for retirement benefits and the choice of thedate is filed on a form provided by the board.
(2) The date must be after the cessation of the member's serviceand be the first day of a month.
(3) The retirement date is not more than six (6) months beforethe date the application is received by the board. However, ifthe board determines that a member is incompetent to file forbenefits and choose a retirement date, the retirement date maybe any date that is the first of the month after the time themember became incompetent.
As added by Acts 1977, P.L.53, SEC.2. Amended by Acts 1980,P.L.28, SEC.5; P.L.48-1985, SEC.1; P.L.342-1989(ss), SEC.2;P.L.4-1990, SEC.7; P.L.10-1995, SEC.4; P.L.73-2002, SEC.2.
IC 5-10.2-4-1.2
Direct deposit of benefits; waiver of direct deposit requirement
Sec. 1.2. (a) Each fund shall adopt a policy that requires directdeposit or another method approved by the board as the preferredway for members and beneficiaries to receive monthly benefits.
(b) A member or beneficiary who does not wish to have payments
to the person deposited by direct deposit or another method approvedby the board under subsection (a) may request the board or adesignee of the board to grant a waiver of the requirement of directdeposit or another method approved by the board. The member orbeneficiary must:
(1) state the reason to the board for requesting the waiver; and
(2) sign a waiver form.
(c) The board or a designee of the board shall grant the member'sor beneficiary's request for a waiver, approval of which shall not beunreasonably denied, if any of the following apply:
(1) The member or beneficiary currently does not have asavings or checking account.
(2) The member or beneficiary is unable to establish a savingsor checking account within the geographic area of the home ofthe member or beneficiary without payment of a service fee. Insupport of this reason, the member or beneficiary must submita written statement of the inability to establish the accountwithout the payment of a fee with the waiver request.
(3) The home of the member or beneficiary is too remote tohave access to a financial institution where direct deposit oranother method approved by the board may be made.
(4) The financial institution of the member or beneficiary isunable to:
(A) accept direct deposit or another method approved by theboard; or
(B) process electronic withdrawal.
The member or beneficiary must submit with the waiver awritten statement from the financial institution of the memberor beneficiary that the financial institution is unable to acceptdirect deposit or another method approved by the board orprocess electronic withdrawal.
(5) The board determines that the facts of the particular casewarrant a waiver of the requirement of direct deposit or anothermethod approved by the board.
(d) The policy of the board must provide that a member orbeneficiary who is in pay status as of July 1, 2009, and is receivingmonthly benefits in a manner other than direct deposit or anothermethod approved by the board shall not have the monthly benefitsstopped for receiving monthly benefits in a manner other than directdeposit or another method approved by the board.
As added by P.L.47-2003, SEC.1. Amended by P.L.115-2009, SEC.3.
IC 5-10.2-4-1.3
Application procedure
Sec. 1.3. (a) A member who files an application for retirementbenefits must provide the following information on the applicationform:
(1) The retirement date chosen by the member.
(2) If the member has not elected to withdraw the entire amountin the member's annuity savings account under IC 5-10.2-3-6.5,
whether the member chooses:
(A) an annuity purchased from the amount credited to themember in the annuity savings account;
(B) a total or partial distribution from the annuity savingsaccount under section 2(b) of this chapter; or
(C) a deferral of the payment of any benefits from theannuity savings account under section 2(c) of this chapter.
(3) The name of the beneficiary or beneficiaries designated bythe member with respect to the pension portion of the member'sretirement benefit.
(4) The name of the beneficiary or beneficiaries designated bythe member with respect to the annuity portion of the member'sretirement benefit, unless the member chooses total distributionunder section 2 of this chapter.
(b) A member's designation of beneficiaries in the application forretirement benefits supersedes any previous designation ofbeneficiaries by the member.
(c) A member must indicate the name, address, date of birth, andSocial Security number of each designated beneficiary and provideproof of birth of each designated beneficiary.
(d) Each board shall adopt a form for the application forretirement benefits that meets the requirements of this section.
As added by P.L.195-1999, SEC.13. Amended by P.L.115-2008,SEC.9.
IC 5-10.2-4-1.4
Direct deposit benefit notice
Sec. 1.4. (a) This section applies to a member or a beneficiary ofthe fund who receives a monthly benefit by direct deposit.
(b) The fund shall furnish to the member or beneficiary:
(1) before each change in the amount of the member's orbeneficiary's benefit; or
(2) once every twelve (12) months, if the member's orbeneficiary's benefit amount does not change;
a written notice showing the member's or beneficiary's benefitamount, including any cost of living increase or other adjustment tothe benefit amount, and a summary of the member's or beneficiary'sbenefit payment history since the member's or beneficiary's lastwritten notice.
As added by P.L.47-2003, SEC.2. Amended by P.L.115-2009, SEC.4.
IC 5-10.2-4-1.5
Estimated benefit payments
Sec. 1.5. (a) A fund may calculate and pay an estimated retirementbenefit of the pension portion to a member if:
(1) the member has applied for a retirement benefit and haschosen a retirement date on which the retirement benefit is tobegin;
(2) the member's membership records are incomplete or havenot been certified; and (3) the member's membership records that have been submittedto the fund establish that the member is entitled to a retirementbenefit.
(b) After June 30, 2009, if a fund calculates and pays an estimatedbenefit under this section, the estimated benefit must be at leasteighty-five percent (85%) of the pension portion of the benefitdetermined under the fund's records on service and compensationinformation.
(c) If an estimated benefit is paid to a member under this section,the fund shall, after all membership records have been submitted tothe fund and certified, determine the actual retirement benefit towhich the member is entitled. After determining the actual retirementbenefit to which the member is entitled, the fund shall temporarilyadjust the actual retirement benefit that is paid to the member toreconcile any underpayment or overpayment of benefits to themember that resulted from the payment of estimated benefits. Thefund may make the temporary adjustment to the member's actualretirement benefit over a reasonable time, as determined by theboard.
As added by P.L.195-1999, SEC.14. Amended by P.L.115-2009,SEC.5.
IC 5-10.2-4-1.7
Elected county official eligibility for normal retirement
Sec. 1.7. (a) This section applies only to members of the publicemployees' retirement fund who retire after June 30, 2002.
(b) A member is eligible for normal retirement after becomingsixty-five (65) years of age if the member:
(1) has:
(A) served as an elected county official in an officedescribed in Article 6, Section 2 of the Constitution of theState of Indiana for at least eight (8) years; or
(B) been elected at least two (2) times and would haveserved at least eight (8) years as an elected county official inan office described in Article 6, Section 2 of the Constitutionof the State of Indiana had the member's term of office notbeen shortened under a statute enacted under Article 6,Section 2(b) of the Constitution of the State of Indiana; and
(2) is prohibited by Article 6, Section 2 of the Constitution ofthe State of Indiana from serving in that office for more thaneight (8) years in any period of twelve (12) years.
(c) A member who:
(1) has served as an elected county official; and
(2) does not meet the requirements of subsection (b);
is eligible for normal retirement if the member has attained vestedstatus (as defined in IC 5-10.2-1-8(b)(3)) and meets the requirementsof section 1 of this chapter.
As added by P.L.73-2002, SEC.3. Amended by P.L.88-2005, SEC.2.
IC 5-10.2-4-1.9
Eligibility of certain state officers for normal retirement
Sec. 1.9. (a) This section applies only to a member of the publicemployees' retirement fund:
(1) who has served as a state officer listed in Article 6, Section1 of the Constitution of the State of Indiana; and
(2) whose term of office as a state officer commenced after theelection held on November 5, 2002.
(b) A member is eligible for normal retirement after becomingsixty-five (65) years of age if the member:
(1) has:
(A) served as a state officer listed in Article 6, Section 1 ofthe Constitution of the State of Indiana for at least eight (8)years; or
(B) been elected at least two (2) times and would haveserved at least eight (8) years as a state officer listed inArticle 6, Section 1 of the Constitution of the State ofIndiana had the member's term of office not been shortenedunder a statute enacted to establish uniform dates forbeginning the terms of state officers listed in Article 6,Section 1 of the Constitution of the State of Indiana; and
(2) is prohibited by Article 6, Section 1 of the Constitution ofthe State of Indiana from serving in that office for more thaneight (8) years in any period of twelve (12) years.
(c) A member who:
(1) has served as a state officer listed in Article 6, Section 1 ofthe Constitution of the State of Indiana; and
(2) does not meet the requirements of subsection (b);
is eligible for normal retirement if the member has attained vestedstatus (as defined in IC 5-10.2-1-8(a)) and meets the requirements ofsection 1 of this chapter.
As added by P.L.115-2008, SEC.10.
IC 5-10.2-4-2
Annuity or distribution benefits; choice of plans; contributionspaid as lump sum
Sec. 2. (a) Unless a member elects otherwise under this section orhas elected to withdraw the member's annuity savings account underIC 5-10.2-3-6.5, the retirement benefit for each member consists ofthe sum of a pension provided by employer contributions plus anannuity provided by the amount credited to the member in theannuity savings account. If a member has elected to withdraw themember's annuity savings account under IC 5-10.2-3-6.5, themember's retirement benefit is equal to the pension provided byemployer contributions, unless the member has transferred thecreditable service earned under the public employees' retirement fundto another governmental retirement plan under IC 5-10.2-3-1(i).Regardless of a member's election under this section, contributionstotaling not more than one thousand dollars ($1,000) that are postedto a member's annuity savings account after the final date on which
the member's retirement benefit is processed may be distributed tothe member as a lump sum payment.
(b) If a member has not elected to withdraw the entire amount inthe member's annuity savings account under IC 5-10.2-3-6.5, amember may choose at retirement or upon a disability retirement toreceive a distribution of:
(1) the entire amount credited to the member in the annuitysavings account; or
(2) an amount equal to the member's federal income tax basis inthe member's annuity savings account balance as it existed onDecember 31, 1986.
If the member chooses to receive the distribution under subdivision(1), the member is not entitled to an annuity as part of the retirementor disability benefit. If the member chooses to receive thedistribution under subdivision (2), the member is entitled to anannuity purchasable by the amount remaining in the member'sannuity savings account after the payment under subdivision (2).
(c) Instead of choosing to receive the benefits described insubsection (a) or (b), if a member has not elected to withdraw theentire amount in the member's annuity savings account underIC 5-10.2-3-6.5, a member may choose upon retirement or upondisability retirement to begin receiving a pension provided byemployer contributions and to defer receiving in any form themember's annuity savings account. If a member chooses this option,the member:
(1) is not entitled to an annuity as part of the member'sretirement or disability benefit, and the member's annuitysavings account will continue to be invested according to themember's direction under IC 5-10.2-2-3; and
(2) may later choose, as of the first day of a month, or analternate date established by the rules of each board, to receivea distribution of:
(A) the entire amount credited to the member in the annuitysavings account; or
(B) an amount equal to the member's federal income taxbasis in the member's annuity savings account balance as itexisted on December 31, 1986.
If the member chooses to receive the distribution under subdivision(2)(A), the member is not entitled to an annuity as part of themember's retirement or disability benefit. If the member chooses toreceive the distribution under subdivision (2)(B), the member isentitled to an annuity purchasable by the amount remaining in themember's annuity savings account after the payment undersubdivision (2)(B). If the member does not choose to receive adistribution under this subsection, the member is entitled to anannuity purchasable by the entire amount in the member's annuitysavings account, and the form of the annuity shall be as described insubsection (d) unless the member elects an option described insection 7(b)(1), 7(b)(2), or 7(b)(4) of this chapter. The amount to bepaid under this section shall be determined in the manner described
in IC 5-10.2-2-3. However, each board may by rule provide for analternate valuation date.
(d) Retirement benefits must be distributed in a manner thatcomplies with Section 401(a)(9) of the Internal Revenue Code, asspecified in IC 5-10.2-2-1.5.
As added by Acts 1977, P.L.53, SEC.2. Amended by P.L.35-1985,SEC.12; P.L.55-1989, SEC.16; P.L.59-1989, SEC.1; P.L.195-1999,SEC.15; P.L.62-2005, SEC.2; P.L.115-2008, SEC.11; P.L.115-2009,SEC.6.
IC 5-10.2-4-3
Average of the annual compensation
Sec. 3. (a) Except as provided in subsection (f), in computing theretirement benefit for a nonteacher member, "average of the annualcompensation" means the average annual compensation calculatedusing the twenty (20) calendar quarters of service in a positioncovered by the retirement fund before retirement in which themember's annual compensation was the highest. However, in orderfor a quarter to be included in the twenty (20) calendar quarters, thenonteacher member must have performed service throughout thecalendar quarter. All twenty (20) calendar quarters do not have to becontinuous but they must be in groups of four (4) consecutivecalendar quarters. The same calendar quarter may not be included intwo (2) different groups.
(b) This subsection does not apply to a teacher member describedin subsection (c). In computing the retirement benefit for a teachermember, "average of the annual compensation" means the averageannual compensation for the five (5) years of service beforeretirement in which the member's annual compensation was highest.In order for a year to be included in the five (5) years, the teachermember must have received for the year credit under IC 5-10.4-4-2for at least one-half (1/2) year of service. The five (5) years do nothave to be continuous.
(c) This subsection applies to a member of the Indiana stateteachers' retirement fund who serves in an elected position for whichthe member takes an unpaid leave of absence. In computing theretirement benefit for a teacher member described in this subsectionfor years of service to which IC 5-10.4-5-7 does not apply, "averageof the annual compensation" means the annual compensation for theone (1) year of service before retirement in which the member'sannual compensation was highest. In order for a year to be used, theteacher member must have received for the year credit underIC 5-10.4-4-2 for at least one-half (1/2) year of service.
(d) Subject to IC 5-10.2-2-1.5, "annual compensation" means:
(1) the basic salary earned by and paid to the member plus theamount that would have been part of that salary but for:
(A) the state's, a school corporation's, a participatingpolitical subdivision's, or a state educational institution'spaying the member's contribution to the fund for themember; or (B) the member's salary reduction agreement establishedunder Section 125, 403(b), or 457 of the Internal RevenueCode; and
(2) in the case of a member described in subsection (c) and foryears of service to which IC 5-10.4-5-7 does not apply, the basicsalary that was not paid during the year but would have beenpaid to the member during the year under the member'semployment contracts, if the member had not taken any unpaidleave of absence to serve in an elected position.
The portion of a back pay award or a similar award that the boarddetermines is compensation under an agreement or under a judicialor an administrative proceeding shall be allocated by the boardamong the years the member earned or should have earned thecompensation. Only that portion of the award allocated to the yearthe award is made is considered to have been earned during the yearthe award was made. Interest on an award is not considered annualcompensation for any year.
(e) Compensation of not more than two thousand dollars ($2,000)received from the employer in contemplation of the member'sretirement, including severance pay, termination pay, retirementbonus, or commutation of unused sick leave or personal leave, maybe included in the total annual compensation from which the averageof the annual compensation is determined, if it is received:
(1) before the member ceases service; or
(2) within twelve (12) months after the member ceases service.
(f) This subsection applies to a member of the general assembly:
(1) who is a participant in the legislators' retirement systemestablished under IC 2-3.5;
(2) who is also a member of the public employees' retirementfund or the Indiana state teachers' retirement fund; and
(3) whose years of service in the general assembly may not beconsidered in determining the average of the annualcompensation under this section, as provided inIC 2-3.5-1-2(b)(2) or IC 2-3.5-3-1(c).
The board shall use the board's actuarial salary increase assumptionto project the salary for any previous year needed to determine theaverage of the annual compensation.
As added by Acts 1977, P.L.53, SEC.2. Amended by P.L.28-1984,SEC.2; P.L.35-1985, SEC.13; P.L.55-1989, SEC.17; P.L.6-1989,SEC.2; P.L.4-1990, SEC.8; P.L.10-1993, SEC.4; P.L.95-2004,SEC.2; P.L.2-2006, SEC.24; P.L.2-2007, SEC.93.
IC 5-10.2-4-3.1
Compensation from two or more employers; computation ofaverage
Sec. 3.1. For a member who receives annual compensation fromtwo (2) or more employers, the average of the annual compensationshall be computed using the sum of the two (2) or more annualcompensations if:
(1) each of the employers and the member made all of the
contributions required by IC 5-10.2; and
(2) the member occupied at least one (1) position that normallyrequired performance of service of more than six hundred (600)hours during the year.
As added by P.L.381-1987(ss), SEC.1.
IC 5-10.2-4-4
Retirement benefit computation
Sec. 4. (a) The computation of benefits under this section issubject to IC 5-10.2-2-1.5.
(b) For retirement benefits payable on and after July 1, 1975, fora member retired on and after January 1, 1956, the pension (p) iscomputed as follows:
STEP ONE: Multiply one and one-tenths percent (1.1%) timesthe average of the annual compensation (aac) and obtain aproduct.
STEP TWO: To obtain the pension, multiply the STEP ONEproduct by the total creditable service (scr) completed by themember on the member's retirement date.
Expressed mathematically:
p = (.011) times (aac) times (scr)
(c) Unless the member:
(1) has chosen a lump sum payment under section 2(b) of thischapter;
(2) has elected to withdraw the entire amount in the member'sannuity savings account under IC 5-10.2-3-6.5; or
(3) elects to defer receiving in any form the member's annuitysavings account under section 2(c) of this chapter;
the annuity is the amount purchasable on the member's retirementdate by the amount credited to the member in the annuity savingsaccount. The amount purchasable is based on actuarial tables adoptedby the board under IC 5-10.2-2-10 at an interest rate determined bythe board.
As added by Acts 1977, P.L.53, SEC.2. Amended by Acts 1980,P.L.28, SEC.6; P.L.35-1985, SEC.14; P.L.45-1988, SEC.1;P.L.55-1989, SEC.18; P.L.195-1999, SEC.16; P.L.115-2008,SEC.12.
IC 5-10.2-4-5
Early retirement percent reduction
Sec. 5. The retirement benefit (rb) payable on and after July 1,1975, for a member who retired on and after January 1, 1956, beforeage sixty-five (65) is the sum of the pension (P), as specified insection 4 of this chapter and computed on the basis of the totalcreditable service and the average of the annual compensation atretirement, multiplied by a percent (p), plus the annuity (A), if any,purchasable by the amount credited to the member in the annuitysavings account. This sum is obtained by the following STEPS:
STEP ONE: From seven hundred eighty (780) months, whichequals sixty-five (65) years, subtract the age of the member at
his retirement date expressed in whole months (retirement agein months) and obtain a remainder (X).
STEP TWO:
(i) If the remainder (X) is less than or equal to sixty (60),then multiply the remainder (X) times one-tenth percent(0.1%) and obtain a product (Y).
(ii) If the remainder (X) is greater than sixty (60), thenmultiply five-twelfths percent (5/12%) times the differenceobtained by subtracting sixty (60) from the remainder (X)and obtain a product. Add to this six percent (6%) and obtaina sum (Y).
STEP THREE: From one hundred percent (100%) subtract theappropriate (Y) and obtain the percent (p).
STEP FOUR: The early retirement benefit equals (p) times (P)plus the annuity (A).
Expressed mathematically:
If "<" means "less than or equal to" and if ">" means "greaterthan"; then:
(I) 780 - (retire age in months) = X;
(II) if X < 60, (X) times (0.1%) = Y; or
if X > 60, (5/12%) times (X-60) + 6% = Y
(III) 100% - Y = p
(IV) rb = pP + A
As added by Acts 1977, P.L.53, SEC.2. Amended by P.L.35-1985,SEC.15.
IC 5-10.2-4-6 Version a
Disability retirement
Note: This version of section amended by P.L.124-2008, SEC.2.See also following version of this section amended by P.L.131-2008,SEC.1.
Sec. 6. (a) A member who becomes disabled while receiving asalary or employer provided income protection benefits or who is onleave under the Family and Medical Leave Act may retire for theduration of the member's disability if:
(1) the member has at least five (5) years of creditable servicebefore the:
(A) termination of a salary or employer provided incomeprotection benefits or Family and Medical Leave Act leave;or
(B) exhaustion of all worker's compensation benefits;
(2) the member has qualified for Social Security disabilitybenefits and has furnished proof of the Social Securityqualification to the board; and
(3) at least once each year until the member reaches agesixty-five (65) a representative of the board verifies thecontinued disability.
For the purposes of this section, a member of the public employees'retirement fund who has qualified for disability benefits under thefederal civil service system is considered to have met the requirement
of subdivision (2) if the member furnishes proof of the qualificationto the board of the public employees' retirement fund.
(b) Benefits for disability shall be paid beginning with the monthfollowing the onset of disability as determined by the Social SecurityAdministration. The benefit is the retirement benefit specified insection 4 of this chapter with the pension computed using only theyears of creditable service worked to the date of disability andwithout reduction for early retirement. However, the monthlydisability retirement benefit may not be less than one hundred eightydollars ($180).
(c) The member may have the member's benefit paid under any ofthe retirement benefit options specified in section 7 of this chapter,except that the member may not choose to have the member'sdisability retirement benefit paid under the method specified undersection 7(b)(3) of this chapter.
(d) This section applies to:
(1) a member of the public employees' retirement fund whobecame disabled after June 30, 1973; and
(2) a member of the Indiana state teachers' retirement fund whobecomes disabled after June 30, 1984, and who choosesdisability retirement under this section.
(e) To the extent required by the Americans with Disabilities Act(42 U.S.C. 12101 et seq.) and any amendments and regulations to theAct, the transcripts, records, and other material compiled todetermine the existence of a disability shall be:
(1) kept in separate medical files for each member; and
(2) treated as confidential medical records.
(f) A member may continue to receive disability benefits from thepublic employees' retirement fund or the Indiana state teachers'retirement fund so long as the member is entitled to receive SocialSecurity benefits, including periods of trial employment orrehabilitation under the Social Security guidelines. However, duringa period of trial employment or rehabilitation, service credit may notbe granted under the public employees' retirement fund or the Indianastate teachers' retirement fund.
(g) If the fund is authorized to make, in the form of a single checkor a series of checks, a one (1) time distribution that does notincrease the pension portion of the monthly benefit, the distributionmust include members eligible for disability benefits. A membereligible for disability benefits is required to meet all additionalrequirements necessary to receive the check or series of checksissued by the fund under this subsection.
As added by Acts 1977, P.L.53, SEC.2. Amended by Acts 1978,P.L.24, SEC.2; P.L.29-1984, SEC.1; P.L.4-1992, SEC.9;P.L.22-1998, SEC.6; P.L.124-2008, SEC.2.
IC 5-10.2-4-6 Version b
Disability retirement
Note: This version of section amended by P.L.131-2008, SEC.1.See also preceding version of this section amended by P.L.124-2008,
SEC.2.
Sec. 6. (a) A member who becomes disabled while receiving asalary or employer provided income protection benefits or who is onleave under the Family and Medical Leave Act may retire for theduration of the member's disability if:
(1) the member has at least five (5) years of creditable servicebefore the:
(A) termination of a salary or employer provided incomeprotection benefits or Family and Medical Leave Act leave;or
(B) exhaustion of all worker's compensation benefits;
(2) the member has qualified for Social Security disabilitybenefits and has furnished proof of the Social Securityqualification to the board; and
(3) at least once each year until the member reaches agesixty-five (65) a representative of the board verifies thecontinued disability.
For the purposes of this section, a member of the public employees'retirement fund who has qualified for disability benefits under thefederal civil service system is considered to have met the requirementof subdivision (2) if the member furnishes proof of the qualificationto the board of the public employees' retirement fund.
(b) Benefits for disability shall be paid beginning with the monthfollowing the onset of disability as determined by the Social SecurityAdministration. The benefit is the retirement benefit specified insection 4 of this chapter with the pension computed using only theyears of creditable service worked to the date of disability andwithout reduction for early retirement. The monthly disabilityretirement benefit payable before July 1, 2008, may not be less thanone hundred dollars ($100). The monthly disability retirementbenefit payable after June 30, 2008, may not be less than onehundred eighty dollars ($180).
(c) The member may have the member's benefit paid under any ofthe retirement benefit options specified in section 7 of this chapter,except that the member may not choose to have the member'sdisability retirement benefit paid under the method specified undersection 7(b)(3) of this chapter.
(d) This section applies to:
(1) a member of the public employees' retirement fund whobecame disabled after June 30, 1973; and
(2) a member of the Indiana state teachers' retirement fund whobecomes disabled after June 30, 1984, and who choosesdisability retirement under this section.
(e) To the extent required by the Americans with Disabilities Act(42 U.S.C. 12101 et seq.) and any amendments and regulations to theAct, the transcripts, records, and other material compiled todetermine the existence of a disability shall be:
(1) kept in separate medical files for each member; and
(2) treated as confidential medical records.
(f) A member may continue to receive disability benefits from the
public employees' retirement fund or the Indiana state teachers'retirement fund so long as the member is entitled to receive SocialSecurity benefits, including periods of trial employment orrehabilitation under the Social Security guidelines. However, duringa period of trial employment or rehabilitation, service credit may notbe granted under the public employees' retirement fund or the Indianastate teachers' retirement fund.
As added by Acts 1977, P.L.53, SEC.2. Amended by Acts 1978,P.L.24, SEC.2; P.L.29-1984, SEC.1; P.L.4-1992, SEC.9;P.L.22-1998, SEC.6; P.L.131-2008, SEC.1.
IC 5-10.2-4-7
Retirement benefit payment options; changes to beneficiarydesignation or form of benefit; annual payment of monthly benefit
Sec. 7. (a) Benefits provided under this section are subject toIC 5-10.2-2-1.5.
(b) A member who retires is entitled to receive monthly retirementbenefits, which are guaranteed for five (5) years or until themember's death, whichever is later. A member may select in writingany of the following nonconflicting options for the payment of themember's retirement benefits instead of the five (5) year guaranteedretirement benefit payments. The amount of the optional paymentsshall be determined under rules of the board and shall be theactuarial equivalent of the benefit payable under sections 4, 5, and 6of this chapter. A member who has elected to withdraw the entireamount in the member's annuity savings account underIC 5-10.2-3-6.5 may not select the cash refund annuity option.
(1) Joint and Survivor Option.
(A) The member receives a decreased retirement benefitduring the member's lifetime, and there is a benefit payableafter the member's death to a designated beneficiary duringthe lifetime of the beneficiary, which benefit equals, at theoption of the member, either the full decreased retirementbenefit or two-thirds (2/3) or one-half (1/2) of that benefit.
(B) If the member dies before retirement, the designatedbeneficiary may receive only the amount credited to themember in the annuity savings account unless the designatedbeneficiary is entitled to survivor benefits under IC 5-10.2-3.
(C) If the designated beneficiary dies before the memberretires, the selection is automatically canceled and themember may make a new beneficiary election and may electa different form of benefit under this subsection.
(2) Benefit with No Guarantee. The member receives anincreased lifetime retirement benefit without the five (5) yearguarantee specified in this subsection.
(3) Integration with Social Security. If the member retiresbefore the age of eligibility for Social Security benefits, in orderto provide a level benefit during the member's retirement themember receives an increased retirement benefit until the ageof Social Security eligibility and decreased retirement benefits
after that age.
(4) Cash Refund Annuity. The member receives a lifetimeannuity purchasable by the amount credited to the member inthe annuity savings account, and the member's designatedbeneficiary receives a refund payment equal to:
(A) the total amount used in computing the annuity at theretirement date; minus
(B) the total annuity payments paid and due to the memberbefore the member's death.
(c) This subsection does not apply to a member of the Indianastate teachers' retirement fund after June 30, 2007, or to a member ofthe public employees' retirement fund after June 30, 2008. If:
(1) the designated beneficiary dies while the member isreceiving benefits; or
(2) the member is receiving benefits, the member marries, eitherfor the first time or following the death of the member's spouse,after the member's first benefit payment is made, and themember's designated beneficiary is not the member's currentspouse or the member has not designated a beneficiary;
the member may elect to change the member's designated beneficiaryor form of benefit under subsection (b) and to receive an actuariallyadjusted and recalculated benefit for the remainder of the member'slife or for the remainder of the member's life and the life of the newlydesignated beneficiary. The member may not elect to change to a five(5) year guaranteed form of benefit. If the member's new election isthe joint and survivor option, the member shall indicate whether thedesignated beneficiary's benefit shall equal, at the option of themember, either the member's full recalculated retirement benefit ortwo-thirds (2/3) or one-half (1/2) of this benefit. The cost ofrecalculating the benefit shall be borne by the member and shall beincluded in the actuarial adjustment.
(d) Except as provided in subsection (c) or section 7.2 of thischapter, a member who files for regular or disability retirement maynot change:
(1) the member's retirement option under subsection (b);
(2) the selection of a lump sum payment under section 2 of thischapter; or
(3) the beneficiary designated on the member's application forbenefits if the member selects the joint and survivor optionunder subsection (b)(1);
after the first day of the month in which benefit payments arescheduled to begin. For purposes of this subsection, it is immaterialwhether a benefit check has been sent, received, or negotiated.
(e) A member may direct that the member's retirement benefits bepaid to a revocable trust that permits the member unrestricted accessto the amounts held in the revocable trust. The member's direction isnot an assignment or transfer of benefits under IC 5-10.3-8-10 orIC 5-10.4-5-14.
(f) Each board may adopt a policy to permit annual payment of amember's retirement benefit whenever the amount of the monthly
retirement benefit to be paid to the member is not more than fivedollars ($5).
As added by Acts 1977, P.L.53, SEC.2. Amended by Acts 1980,P.L.28, SEC.7; P.L.35-1985, SEC.16; P.L.59-1989, SEC.2;P.L.55-1989, SEC.19; P.L.59-1989, SEC.3; P.L.4-1990, SEC.9;P.L.195-1999, SEC.17; P.L.246-2001, SEC.5; P.L.190-2003, SEC.2;P.L.2-2006, SEC.25; P.L.149-2007, SEC.1; P.L.93-2008, SEC.1;P.L.115-2008, SEC.13; P.L.115-2009, SEC.7.
IC 5-10.2-4-7.2
Changes to beneficiary designation
Sec. 7.2. (a) This section applies to the following:
(1) A member of the Indiana state teachers' retirement fund afterJune 30, 2007.
(2) A member of the public employees' retirement fund afterJune 30, 2008.
(b) Subject to subsection (g), if a member is receiving a benefitfrom the fund and:
(1) the member's designated beneficiary dies;
(2) the member and the member's designated beneficiary havebeen parties in an action for dissolution of marriage in which afinal order has been issued after the member's first benefitpayment is made. It is immaterial whether the final order wasissued before, on, or after the date in subsection (a)(1) or (a)(2);or
(3) the member marries after the member's first benefit paymentis made, and:
(A) the member's designated beneficiary is not the member'scurrent spouse; or
(B) the member has not designated a beneficiary;
the member may make the election described in subsection (c).
(c) A member described in subsection (b) may elect to:
(1) change the member's designated beneficiary or form ofbenefit under section 7(b) of this chapter; and
(2) receive an actuarially adjusted and recalculated benefit forthe remainder of:
(A) the member's life; or
(B) the member's life and the life of the newly designatedbeneficiary.
(d) A member making the election under subsection (c) may notelect to change to a five (5) year guaranteed form of benefit undersection 7(b) of this chapter.
(e) If a member elects a benefit under subsection (c)(2)(B), themember must indicate whether the newly designated beneficiary'sbenefit will equal:
(1) the member's full recalculated benefit;
(2) two-thirds (2/3) of the member's recalculated benefit; or
(3) one-half (1/2) of the member's recalculated benefit.
(f) The member bears the cost of recalculating a benefit undersubsection (c)(2), and the cost shall be included in the actuarial
adjustment.
(g) A member may not make the election under subsection (c) ifa final order or property settlement in an action for dissolution ofmarriage:
(1) prohibits a change in the member's designated beneficiary;or
(2) provides a right to a survivor benefit to a person who wouldbe removed as the designated beneficiary.
(h) Benefits may be recalculated under this section only to theextent permitted by the Internal Revenue Code and applicableregulations.
(i) Before implementing this section, the board may obtain anyapprovals that the board considers necessary or appropriate from theInternal Revenue Service.
As added by P.L.149-2007, SEC.2. Amended by P.L.9-2008, SEC.1;P.L.93-2008, SEC.2.
IC 5-10.2-4-7.5
School corporations participating in Section 401(a) plans;participation in plan under this chapter
Sec. 7.5. A member may participate in a plan described inIC 5-10-1.1-1(2) in addition to the plans set forth in this chapter.
As added by P.L.42-1988, SEC.3.
IC 5-10.2-4-8
Reemployment after retirement; when retirement benefitsapplication void
Sec. 8. (a) Subject to subsection (f), if a member who is receivingretirement benefits becomes reemployed in a position covered by thisarticle more than thirty (30) days after the member's retirement, themember's retirement benefit payments continue. Except for a memberof the Indiana state teachers' retirement fund who is reemployedmore than thirty (30) days after the member's retirement in a positioncovered by the Indiana state teachers' retirement fund, the membershall begin making contributions as required in IC 5-10.2-3-2, andthe member's employer shall make contributions throughout themember's period of reemployment.
(b) If a member who is receiving retirement benefits isreemployed in a position covered by this article not more than thirty(30) days after the member's retirement, the member's retirementbenefits shall stop, the member shall begin making contributions asrequired by IC 5-10.2-3-2, and employer contributions shall be madethroughout the period of reemployment.
(c) This subsection does not apply to a member of the Indianastate teachers' retirement fund who is reemployed more than thirty(30) days after the member's retirement in a position covered by theIndiana state teachers' retirement fund. If a retired member isreemployed in a position covered by this article, section 10 of thischapter applies to the member upon the member's retirement fromreemployment. (d) Subject to subsection (f), the following apply to a member ofthe Indiana state teachers' retirement fund who is reemployed morethan thirty (30) days after the member's retirement in a positioncovered by the Indiana state teachers' retirement fund:
(1) The member's retirement benefit payments continue duringthe member's period of reemployment without regard to theamount of the member's earnings from the covered position.
(2) The member may not make contributions underIC 5-10.2-3-2 or IC 5-10.4-4-11 during the member's period ofreemployment.
(3) The member's employer may not make contributions underIC 5-10.2-2-11 or IC 5-10.4-4-11 for or on behalf of the memberduring the member's period of reemployment.
(4) The member does not earn creditable service underIC 5-10.2-3-1 for the member's period of reemployment.
(5) The member is not entitled to an additional benefit undersections 9 and 10 of this chapter for the member's period ofreemployment.
(e) The thirty (30) day period provided for in this section may beimplemented unless the board of trustees of the fund receives adetermination from the Internal Revenue Service prohibiting theimplementation.
(f) After July 31, 2009, if, on or before the date the member filesan application for retirement benefits under this article, a memberhas a formal or informal agreement with an employer covered by thisarticle to become reemployed in a position covered by this articleafter the member's retirement, regardless of the time frame betweenthe member's retirement and the member's reemployment, themember's application for retirement benefits is void, and thefollowing apply to the member's continued employment:
(1) If a member has received a retirement benefit:
(A) the member's retirement benefit shall stop; and
(B) the member shall repay the amount of the retirementbenefit received.
(2) The member shall make contributions as required byIC 5-10.2-3-2 throughout the period of the member's continuedemployment.
(3) Employer contributions shall be made throughout the periodof the member's continued employment.
(4) The member shall earn creditable service underIC 5-10.2-3-1 for the member's continued employment.
(5) When the period of the member's continued employmentterminates, the member may again file an application forretirement benefits under this chapter.
As added by Acts 1977, P.L.53, SEC.2. Amended by P.L.49-1985,SEC.1; P.L.195-1999, SEC.18; P.L.246-2001, SEC.6; P.L.62-2005,SEC.3; P.L.72-2007, SEC.5; P.L.76-2008, SEC.2; P.L.130-2008,SEC.1; P.L.115-2009, SEC.8.
IC 5-10.2-4-8.2
Election, appointment to elected position, or service in otherposition covered by this article
Sec. 8.2. (a) Notwithstanding section 8 of this chapter, if amember who is receiving retirement benefits is elected or appointedto an elected position covered by this article, the member shall filea written, irrevocable election with the board to continue ordiscontinue retirement benefits while the member holds the electedposition.
(b) If a member:
(1) is elected or appointed to an elected position and:
(A) becomes at least fifty-five (55) years of age; and
(B) completes at least twenty (20) years of service; or
(2) is serving in any other position covered by this article and:
(A) becomes at least seventy (70) years of age; and
(B) completes at least twenty (20) years of service;
while holding the position, the member may file a written,irrevocable election to begin receiving, while holding the position,retirement benefits to which the member would be entitled by ageand service. A member who does not make the irrevocable electionwhile holding the position is entitled to retroactive payments to coverany period from the date the member qualifies to make the electionunder this subsection to the date the member files the election underthis subsection.
(c) The form and content of an election shall be prescribed by theboard. If the member elects to discontinue receiving retirementbenefits, the member shall make contributions as required inIC 5-10.2-3-2. If the member elects to continue or begin receivingbenefits:
(1) the member may continue to make contributions underIC 5-10.2-3-2 but is not required to do so; and
(2) the member waives the accrual of service credit and theright to any supplemental benefit from service in the position,except to the extent that the value of the accrual of additionalservice credit and any supplemental benefit exceeds theactuarial value of the benefits received under this chapter andthat were continued or begun pursuant to an election under thissection.
(d) Except to the extent of the liability for any additional benefitaccrued under subsection (c)(2), the employer shall make theemployer's contribution only for past service liability based on thesalary for the position of a member who elects under subsection (a)or (b) to continue or begin receiving retirement benefits.
(e) Section 10 of this chapter applies to a member who electsunder subsection (a) to discontinue receiving retirement benefits.Section 10 of this chapter does not apply, while the member holds aposition covered by this article, to a member who elects undersubsection (a) or (b) to continue or begin receiving retirementbenefits.
As added by P.L.47-1985, SEC.4. Amended by P.L.60-1989, SEC.1;
P.L.4-1990, SEC.10; P.L.25-1994, SEC.4; P.L.61-2002, SEC.6.
IC 5-10.2-4-8.4
Retirement while serving in elected position
Sec. 8.4. (a) This section does not apply to a member of theIndiana state teachers' retirement fund who is eligible to retire underIC 5-10.2-2-8(b).
(b) A member of the Indiana state teachers' retirement fund who:
(1) serves in an elected position; and
(2) after June 30, 2006, makes an election under section 8.2(b)of this chapter to begin receiving, while the member holds theelected position or not later than thirty (30) days after the dayon which the member's elected term of office ends, theretirement benefits to which the member is entitled by age andservice;
may choose at the member's retirement date whether to retire fromthe Indiana state teachers' retirement fund or from the publicemployees' retirement fund.
(c) If the member described in subsection (b) chooses to retirefrom the public employees' retirement fund, that fund is responsiblefor the payment of benefits provided under this chapter, and theIndiana state teachers' retirement fund shall pay to the publicemployees' retirement fund:
(1) the amount credited to that member in the annuity savingsaccount in the Indiana state teachers' retirement fund; and
(2) the proportionate actuarial cost of the member's pension.
As added by P.L.119-2006, SEC.2. Amended by P.L.93-2008, SEC.3.
IC 5-10.2-4-9
Death during reemployment
Sec. 9. (a) This section does not apply to a member of the Indianastate teachers' retirement fund who is reemployed more than thirty(30) days after the member's retirement in a position covered by theIndiana state teachers' retirement fund.
(b) If a member dies during reemployment and retirement benefitsfrom before the member's reemployment are payable after themember's death, the payment of these amounts shall be made withoutchange, and any additional benefit earned during reemployment shallbe paid as provided in section 10 of this chapter.
As added by Acts 1977, P.L.53, SEC.2. Amended by P.L.47-1985,SEC.5; P.L.246-2001, SEC.7; P.L.72-2007, SEC.6; P.L.76-2008,SEC.3.
IC 5-10.2-4-10
Benefits after reemployment
Sec. 10. (a) This section does not apply to a member of theIndiana state teachers' retirement fund who is reemployed more thanthirty (30) days after the member's retirement in a position coveredby the Indiana state teachers' retirement fund.
(b) Benefits provided under this section are subject to
IC 5-10.2-2-1.5.
(c) Upon termination of reemployment, except by death, theretirement benefits from before the member's reemployment whichare payable after termination shall be paid without change.
(d) If the member is reemployed for fewer than ninety (90)consecutive school or working days, upon termination ofreemployment, contributions and interest credited to the member'sannuity savings account shall be paid to the member.
(e) If the member is reemployed for ninety (90) or moreconsecutive school or working days, upon termination ofreemployment, the member shall receive an additional benefit.
(f) The additional retirement benefit consists of the sum of asupplemental pension and a supplemental annuity. The supplementalpension is computed under section 4 of this chapter using themember's:
(1) years of service during the member's reemployment; and
(2) average compensation during the member's reemployment,if the member is reemployed for less than five (5) years, oraverage of the annual compensation (as defined in section 3 ofthis chapter) during the member's reemployment.
If the member is entitled to a supplemental annuity, it consists of anannuity provided by contributions and interest credited to themember during reemployment, if any.
(g) The additional retirement benefits are guaranteed for five (5)years or until the member's death, whichever is later. The membermay choose instead of the guaranteed payments any of the optionsunder section 7 of this chapter for the payment of the member'sadditional retirement benefits.
(h) IC 5-10.2-2-7 applies to additional retirement benefits.
As added by Acts 1977, P.L.53, SEC.2. Amended by P.L.49-1985,SEC.2; P.L.40-1986, SEC.2; P.L.55-1989, SEC.20; P.L.22-1993,SEC.3; P.L.25-1994, SEC.5; P.L.246-2001, SEC.8; P.L.72-2007,SEC.7; P.L.76-2008, SEC.4.
IC 5-10.2-4-10.2
Repealed
(Repealed by P.L.40-1986, SEC.3.)