35 IAC 14-2-17 ASA and RSA annuity interest

Sec. 17. (a) Whenever a member elects to annuitize the member's ASA or RSA, the annuitized interest rate will be applied beginning with the date of the distribution of the annuity and the annuity will be calculated prospectively from that date regardless whether the distribution was deferred under IC 5-10.2-4-2(c), there is a retroactive disability payment under IC 5-10.2-4-6, or there is a retroactive benefit payment under IC 5-10.2-4-8.2. (b) The annuity interest rate is determined by IC 5-10.5-4-2.6 and this rule. Except for as set forth in subsection (c), the annuity interest rate that will be applied is the rate in effect as of the retirement date as determined under IC 5-10.2-4-1.3, the disability retirement date, or the member's retirement date due to election made under IC 5-10.2-4-8.2. (c) Except as provided in IC 5-10.5-4-2.6, when a member elects to defer receiving, in any form, the member's annuity savings account under IC 5-10.2-4-2(c), the annuity interest rate that will be applied is the rate in effect as of the date INPRS receives the member's postretirement payment of ASA election form. (d) When a member elects to change their survivor beneficiary or pension option, or both, under IC 5-10.2-4-7.2, the annuity interest rate that will be applied is the rate in effect as of the date INPRS receives the member's election form. (e) For example, Julia is a seventy-five (75) year old active member with twenty-five (25) years of creditable service. She makes an election under IC 5-10.2-4-8.2 to begin receiving benefits relating back to the date she was first eligible to make the election (five (5) years ago). Julia elects to annuitize her ASA. The annuity is calculated and interest rate is the rate in effect on the retirement date Julia selects. Julia will receive five (5) years of retroactive pension benefits using only twenty (20) years of service credit in the pension calculation. Because Julia's ASA account was actively earning interest, gains, or losses during the five (5) year period before Julia made the election, and the ASA had not been annuitized during this period, the annuitized interest rate will be applied beginning with the actual date of distribution of the annuity.