§ 8407. Eligibility for benefits.

297 words·~1 min read·/pa/title-24/chapter-84/8407

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(a)Termination of service.-- A participant who terminates school service shall be eligible to withdraw the vested accumulated total defined contributions standing to the participant's credit in the participant's individual investment account or a lesser amount as the participant may request. Payment shall be made in a lump sum unless the board has established other forms of distribution in the plan document. A participant who withdraws the vested accumulated total defined contributions shall no longer be a participant in the plan, notwithstanding that the former school employee may continue to be a member of the system with Class T-G or Class T-H service credit, or may contract to receive an annuity or other form of payment from a provider retained by the board for such purposes.

(b)Required distributions.-- All payments under this section shall start and be made in compliance with the minimum distribution requirements and incidental death benefit rules of IRC § 401(a)(9). The board shall take any action and make any distributions it may determine are necessary to comply with those requirements.

(c)Prohibited distributions.-- A school employee must be terminated from all positions that result in either membership in the system or participation in the plan to be eligible to receive a distribution.

(d)Loans.-- Loans or other distributions, including hardship or unforeseeable emergency distributions, from the plan to school employees who have not terminated school service are not permitted, except as required by law.

(e)Small individual investment accounts.-- A participant who terminates school service and whose vested accumulated total defined contributions are below the threshold established by law as of the date of termination of service may be paid the vested accumulated total defined contributions in a lump sum as provided in IRC § 401(a)(31).

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