38.1704 Payment of benefit to alternate payee under EDRO; effective date; form.
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38.1704 Payment of benefit to alternate payee under EDRO; effective date; form.
Sec. 4.
Except as otherwise provided in this act, the payment of a benefit to an alternate payee under an EDRO and this act shall begin on the retirement allowance effective date of the participant. The payment of a benefit under an EDRO and this act shall be paid in 1 of the following forms, as applicable:
(a)A single life annuity that is equal to the actuarial equivalent of the alternate payee's share of the benefit payable throughout the life of the alternate payee. If the participant is entitled to the payment of a benefit that is not reduced due to early retirement under the retirement system, the alternate payee's single life annuity shall be calculated using the participant's unreduced benefit. If the participant is only entitled to the payment of a benefit that is reduced due to early retirement under the retirement system, the alternate payee's single life annuity shall be calculated using the participant's reduced benefit.
(b)If a retirement system offers a participant an optional form of payment of a benefit at retirement, a reduced benefit that is equal to the actuarial equivalent of the total benefit being divided under the EDRO payable throughout the lives of the participant and the alternate payee. The reduced benefit shall be payable in the manner provided under the optional form of payment under the retirement system. The EDRO shall specify the percentage or amount of the reduced benefit that is payable under this subdivision to the participant and to the alternate payee while both are alive. If the participant predeceases the alternate payee while a reduced benefit is being paid to the participant and the alternate payee under this subdivision, the survivor portion of the reduced benefit shall be payable to the alternate payee. If the alternate payee predeceases the participant while a reduced benefit is being paid to the participant and the alternate payee under this subdivision, the alternate payee's percentage or amount of the reduced benefit shall revert to and become payable to the participant.
(c)A single life annuity that is equal to the alternate payee's share of the benefit payable throughout the life of the participant.
History: 1991, Act 46, Imd. Eff. June 27, 1991