19-20-602. Annuity savings account -- member's contribution.
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19-20-602 . Annuity savings account -- member's contribution.
(1)The annuity savings account is an account in which the contributions for the members to provide for their retirement allowance or benefits must be accumulated in individual accounts for each member.
(a)The normal contribution rate of each tier one member is 7.15% of the member's earned compensation.
(b)The normal contribution rate of each tier two member is 8.15% of the member's earned compensation.
(3)Contributions under 19-20-608 and this section to the annuity savings account must be made in the following manner:
(a)Each employer, pursuant to section 414(h)(2) of the Internal Revenue Code:
(i)shall pick up and pay the contributions that would be payable by the member under this subsection
(3)for service rendered after June 30, 1985;
(ii)shall pick up and pay the contributions that would be paid in the manner provided in 19-20-716 ; and
(iii)may pick up and pay the contributions that would be payable by the member pursuant to 19-20-415 .
(b)The member's contributions picked up by the employer must be designated for all purposes of the retirement system as the member's contributions, except for the determination of a tax upon a distribution from the retirement system. These contributions must become part of the member's accumulated contributions but must be accounted for separately from those previously accumulated.
(c)The member's contributions picked up by the employer must be payable from the same source as is used to pay compensation to the member and must be included in the member's earned compensation as defined in 19-20-101 . The employer shall deduct from the member's compensation an amount equal to the amount of the member's contributions picked up by the employer and remit the total of the contributions to the retirement board.
(d)The deductions must be made notwithstanding that the minimum compensation provided by law for a member may be reduced by the deductions. Each member is considered to consent to the deductions prescribed by this section, and payment of salary or compensation less the deductions is a complete discharge of all claims for the services rendered by the member during the period covered by the payment, except as to the benefits provided by the retirement system.
(4)The accumulated contributions of a member withdrawn by the member or paid to the member's estate or to the member's designated beneficiary in event of the member's death must be paid from the annuity savings account. Upon the retirement of a member, the member's accumulated contributions must be transferred from the annuity savings account to the pension accumulation account.