retirement; legislative
employees option; transfers
HB 2007 allows a legislative employee who is a member of the Arizona State Retirement System (ASRS) and term-limited elected officials who are members of the Elected Officials Retirement Plan (EORP) to transfer all monies accrued by the member to a tax-deferred annuity and compensation program.
Laws 1999, Ch. 329, Sec. 1, added a third retirement option for ASRS members, which was classified as a 457 deferred compensation plan. Because of the tax status of a 457, members were unable to transfer the money already accrued by their current plan to the new option. The program is now classified as a 401(a) plan, which allows the transfer to be completed because of its tax-qualified status. This bill provides for the transfer of the member’s account.
· Allows a legislative employee or term-limited elected official to request a transfer of their accrued liability as calculated by the fund to a tax-deferred annuity and compensation plan.
· States that a member who elects to participate in the tax-deferred annuity and compensation program, but does not request a transfer of their account (from ASRS or EORP to the tax-deferred annuity and compensation program), can collect the benefits accrued from ASRS or EORP upon retirement, in addition to the money from the tax-deferred annuity and compensation program. A member who elects to participate in the tax-deferred annuity and compensation program and transfers their ASRS or EORP account, waives the benefits of ASRS or EORP and does not receive benefits from ASRS or EORP upon retirement.
· Allows term-limited elected officials, exempt state officers, and legislative employees to contribute up to the IRS tax limit of 25 per cent of their monthly compensation, or $30,000 annually to their defined contribution account.
· Provides a delayed effective date for the IRS contribution limit of June 30, 2001.
HB 2007 was amended
in the Government Operations committee as follows:
· Allows term-limited elected officials to transfer their funds from EORP to the tax-deferred annuity and compensation program.
· Allows term-limited elected officials, exempt state officers, and legislative employees to contribute up to the IRS tax limit of 25 per cent of their monthly compensation, or $30,000 annually to their defined contribution account.
· Provides a delayed effective date for the IRS contribution limit of June 30, 2001.
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44th Legislature Analyst Initials _______
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Second Regular Session February 4, 2000
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