Correction of Administrative Errors; Required Minimum Distributions, 40569-40571 [2020-13683]
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40569
Rules and Regulations
Federal Register
Vol. 85, No. 130
Tuesday, July 7, 2020
This section of the FEDERAL REGISTER
contains regulatory documents having general
applicability and legal effect, most of which
are keyed to and codified in the Code of
Federal Regulations, which is published under
50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by
the Superintendent of Documents.
FEDERAL RETIREMENT THRIFT
INVESTMENT BOARD
5 CFR Parts 1605, 1650 and 1651
Correction of Administrative Errors;
Required Minimum Distributions
Federal Retirement Thrift
Investment Board.
ACTION: Direct final rule.
AGENCY:
The Federal Retirement Thrift
Investment Board (FRTIB) is amending
its regulations to make a nonsubstantive change to the constructed
share price formula for a retired
Lifecycle (L) Fund. The FRTIB uses a
constructed share price to make error
corrections involving a retired L Fund.
In addition, due to a recent change in
the Internal Revenue Code (Code), the
FRTIB is amending its regulations to
change the age by which TSP
participants must begin receiving
distributions from their TSP accounts
from 701⁄2 to 72.
DATES: Effective July 7, 2020. The
change to the constructed share price
formula is applicable June 30, 2020,
without further action, unless adverse
comment is received by August 6, 2020.
If adverse comment is received, FRTIB
will publish a timely withdrawal of the
rule in the Federal Register. As required
by the Code, the change to the age by
which TSP participants must begin
receiving distributions from their
accounts is effective for distributions
required to be made after December 31,
2019, with respect to individuals who
will reach age 701⁄2 after that date.
ADDRESSES: You may submit comments
using one of the following methods:
• Federal Rulemaking Portal: https://
www.regulations.gov. Follow the
instructions for submitting comments.
• Mail: Office of General Counsel,
Attn: Megan G. Grumbine, Federal
Retirement Thrift Investment Board, 77
K Street NE, Suite 1000, Washington,
DC 20002.
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• Facsimile: Comments may be
submitted by facsimile at (202) 942–
1676.
Since March 23, 2020, the FRTIB has
been operating under a mandatory
telework status due to the coronavirus
pandemic which has severely limited
the ability to timely monitor mail and
facsimiles. Therefore, we strongly
encourage using the Federal Rulemaking
Portal to submit comments.
FOR FURTHER INFORMATION CONTACT:
Austen Townsend, (202) 864–8647.
SUPPLEMENTARY INFORMATION: The
FRTIB administers the TSP, which was
established by the Federal Employees’
Retirement System Act of 1986
(FERSA), Public Law 99–335, 100 Stat.
514. The TSP is a tax-deferred
retirement savings plan for Federal
civilian employees and members of the
uniformed services. The TSP is similar
to cash or deferred arrangements
established for private-sector employees
under section 401(k) of the Internal
Revenue Code (26 U.S.C. 401(k)).
Lifecycle Funds
In addition to its five core funds (the
G, F, C, S, and I Funds) the TSP offers
multiple L Funds, each of which is
made up entirely of the five core funds
in different, professionally determined,
proportions based on a particular time
horizon, or target retirement date. Each
L fund is ‘‘retired’’ when it reaches its
target date.
Currently, the TSP offers L Funds
based on a 10-year asset allocation. A
10-year L Fund must, by design, be
retired on December 31st of year in
which it reaches its target date. For
example, the L 2010 reached its target
date in 2010 and was retired on
December 31, 2010.
Beginning July 1, 2020, the TSP will
instead offer L Funds based on a 5-year
asset allocation to give TSP participants
a more targeted window of time to
match their intended retirement date
with their asset allocation. As a result of
the shift from 10-year to 5-year L Funds,
L Funds beginning with the L 2020 fund
will be retired on June 30th of the year
in which they reach their respective
retirement dates.
Correcting Errors Involving Retired L
Funds
Once an L Fund is retired, TSP
participants are no longer able to make
contributions to that fund. However, the
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Fmt 4700
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FRTIB is sometimes required to
calculate lost earnings (i.e., breakage) on
errors involving these retired L Funds.
Breakage is the loss incurred (negative
earnings) or the gain realized (positive
earnings) on late and makeup
contributions. Similarly, the FRTIB
must sometimes process the removal of
erroneous contributions (i.e., a negative
adjustment) previously made to a nowretired L Fund. The value of a negative
adjustment equals the amount of the
erroneous contributions plus earnings
(positive or negative) on that amount.
Generally, the FRTIB uses the current
share price of the applicable investment
fund when calculating breakage or the
value of a negative adjustment. Because
a retired L Fund no longer exists, the
FRTIB instead uses a constructed share
price in order to calculate breakage or
the value of negative adjustments on
errors involving these funds.
The constructed share price for a
retired L Fund is calculated using the
final posted share price of that L Fund
(i.e., the share price posted on the date
the L Fund was retired). When the
constructed share price formula was
created, all L Funds were based on a 10year asset allocation. Therefore, rather
than referring to the L Fund’s final
posted share price, the FRTIB’s existing
regulations provide that the constructed
share price for a retired Lifecycle fund
is calculated using the share price of the
L Fund on December 31 of its retirement
year.
To account for the fact that L Funds
will no longer be retired on December
31st as a result of the shift from 10-year
to 5-year L Funds, the FRTIB is
updating its regulations to remove the
references to December 31st in the
constructed share price formula.
Instead, consistent with the FRTIB’s
original intent, the regulations will
simply refer to the final posted share
price. The substance of the formula
remains unchanged.
Required Minimum Distributions
On December 20, 2019, the President
signed into law the Setting Every
Community Up for Retirement
Enhancement (SECURE) Act (Division O
pg. H.R. 1865–604), as part of the
Further Consolidated Appropriations
Act of 2020 (Pub. L. 116–94). The
SECURE Act amended the Code to
change the age by which TSP
participants must begin receiving
distributions (referred to as required
E:\FR\FM\07JYR1.SGM
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40570
Federal Register / Vol. 85, No. 130 / Tuesday, July 7, 2020 / Rules and Regulations
minimum distributions (RMDs)) from
their accounts from 701⁄2 to 72.
The RMD rules under the Code,
which apply to both separated TSP
participants and TSP beneficiary
participants,1 set forth the date by
which participants must receive RMDs
(i.e., the required beginning date). Prior
to the passage of the SECURE Act, the
Code required separated TSP
participants to receive RMDs beginning
on April 1 of the year following the year
in which the participant reached age
701⁄2 and annually thereafter. TSP
beneficiary participants were required
to receive RMDs beginning on the later
of the end of the year following the year
in which the participant died, or the
end of the year in which the participant
would have reached age 701⁄2. TSP
participants who turned 701⁄2 on or
before December 31, 2019 remain
subject to these pre-SECURE Act
required beginning date rules.
Participants who had not reached age
701⁄2 before January 1, 2020 are subject
to the new required beginning date
rules. Specifically, the Code, as
amended by the SECURE Act, requires
a separated TSP participant to receive
RMDs beginning on April 1 of the year
following the year in which he or she
reaches age 72 and is separated from
service and annually thereafter. TSP
beneficiary participants must receive
RMDs beginning on the later of the end
of the year following the year in which
the participant died, or the end of the
year in which the participant would
have reached age 72.
The FRTIB is updating its regulations
by removing the references to age 701⁄2
in the definition of ‘‘required beginning
date.’’ The updated regulations will
instead define this term by
incorporating by reference the Code’s
definition of required beginning date.
This ensures that FRTIB regulations
regarding RMDs will always be
consistent with the Code’s requirements
so that future amendments on short
notice may be avoided.
Regulatory Flexibility Act
I certify that this regulation will not
have a significant economic impact on
a substantial number of small entities.
This regulation will affect Federal
employees and members of the
uniformed services who participate in
the Thrift Savings Plan, which is a
Federal defined contribution retirement
savings plan created under the Federal
Employees’ Retirement System Act of
1986 (FERSA), Public Law 99–335, 100
Stat. 514, and which is administered by
the Agency.
■
Paperwork Reduction Act
*
I certify that this regulation does not
require additional reporting under the
criteria of the Paperwork Reduction Act.
Unfunded Mandates Reform Act of
1995
Pursuant to the Unfunded Mandates
Reform Act of 1995, 2 U.S.C. 602, 632,
653, 1501–1571, the effects of this
regulation on state, local, and tribal
governments and the private sector have
been assessed. This regulation will not
compel the expenditure in any one year
of $100 million or more by state, local,
and tribal governments, in the aggregate,
or by the private sector. Therefore, a
statement under section 1532 is not
required.
Submission to Congress and the
General Accounting Office
Pursuant to 5 U.S.C. 810(a)(1)(A), the
Agency submitted a report containing
this rule and other required information
to the U.S. Senate, the U.S. House of
Representatives, and the Comptroller
General of the United States before
publication of this rule in the Federal
Register. This rule is not a major rule as
defined at 5 U.S.C. 804(2).
List of Subjects
5 CFR Part 1605
Claims, Government employees,
Pensions, Retirement.
5 CFR Part 1650
Alimony, Claims, Government
employees, Pensions, Retirement
5 CFR Part 1651
Claims, Government employees,
Pensions, Retirement.
Ravindra Deo,
Executive Director, Federal Retirement Thrift
Investment Board.
For the reasons stated in the
preamble, the FRTIB amends 5 CFR
chapter VI as follows:
PART 1605—CORRECTION OF
ADMINISTRATIVE ERRORS
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§ 1605.2 Calculating, posting, and
charging breakage on late contributions
and loan payments.
*
*
*
*
(b) * * *
(1) * * *
(iii) Determine the dollar value on the
posting date of the number of shares the
participant would have received had the
contributions or loan payments been
made on time. If the contributions or
loan payments would have been
invested in a Lifecycle fund that is
retired on the posting date, the
constructed share price shall equal the
final posted share price of the retired
Lifecycle fund, multiplied by the
current L Income Fund share price,
divided by the L Income Fund share
price on the same date that the retired
Lifecycle fund posted its final share
price. The dollar value shall be the
number of shares the participant would
have received had the contributions or
loan payments been made on time
multiplied by the constructed share
price.
*
*
*
*
*
■ 3. Amend § 1605.12 by revising
paragraph (c)(2)(ii) to read as follows:
§ 1605.12 Removal of erroneous
contributions.
*
*
*
*
*
(c) * * *
(2) * * *
(ii) Multiply the price per share on the
date the adjustment is posted by the
number of shares calculated in
paragraph (c)(2)(i) of this section. If the
contribution was erroneously
contributed to a Lifecycle fund that is
retired on the date the adjustment is
posted, the price per share shall equal
the final posted share price of the
retired Lifecycle fund, multiplied by the
current L Income Fund share price,
divided by the L Income Fund share
price on the same date that the retired
Lifecycle fund posted its final share
price.
*
*
*
*
*
PART 1650—METHODS OF
WITHDRAWING FUNDS FROM THE
THRIFT SAVINGS PLAN
4. The authority citation for Part 1650
continues to read as follows:
■
1. The authority citation for Part 1605
continues to read as follows:
■
1 A beneficiary participant is a spouse beneficiary
of a deceased TSP participant who has a TSP
beneficiary participant account established in his or
her name. In the case of a beneficiary participant,
the age of the deceased participant is used when
determining the date by which RMDs must
commence.
2. Amend § 1605.2 by revising
paragraph (b)(1)(iii) to read as follows:
Authority: 5 U.S.C. 8351, 8432a, 8432d,
8474(b)(5) and (c)(1). Subpart B also issued
under section 1043(b) of Public Law 104–
106, 110 Stat. 186 and section 7202(m)(2) of
Public Law 101–508, 104 Stat. 1388.
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Fmt 4700
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Authority: 5 U.S.C. 8351, 8432d, 8434,
8435, 8474(b)(5) and 8474(c)(1).
5. Amend § 1650.1(b) by revising the
definition for ‘‘Required beginning
date’’ to read as follows:
■
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Federal Register / Vol. 85, No. 130 / Tuesday, July 7, 2020 / Rules and Regulations
§ 1650.1
Definitions.
*
*
*
*
*
(b) * * *
Required beginning date means the
required beginning date as defined in
Internal Revenue Code section 401(a)(9)
and the regulations and guidance
promulgated thereunder.
*
*
*
*
*
PART 1651—DEATH BENEFITS
6. The authority citation for Part 1651
continues to read as follows:
■
Authority: 5 U.S.C. 8424(d), 8432d,
8432(j), 8433(e), 8435(c)(2), 8474(b)(5) and
8474(c)(1).
7. Amend § 1651.1(b) by revising the
definition for ‘‘Required beginning
date’’ to read as follows:
■
§ 1651.1
Definitions.
*
*
*
*
*
(b) * * *
Required beginning date means the
required beginning date as defined in
Internal Revenue Code section 401(a)(9)
and the regulations and guidance
promulgated thereunder.
*
*
*
*
*
[FR Doc. 2020–13683 Filed 7–2–20; 8:45 am]
BILLING CODE 6760–01–P
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Parts 201 and 202
[Doc. No. AMS–ST–19–0039]
RIN 0581–AD91
Revisions to the Federal Seed Act
Regulations
Agricultural Marketing Service,
USDA.
ACTION: Final rule.
AGENCY:
This final rule revises the
regulations that implement the Federal
Seed Act (FSA). Revisions are made to
seed labeling, testing, and certification
requirements. The revisions add certain
seed species to the lists of covered kinds
of seed and update the lists to reflect
current scientific nomenclature; update
regulations related to seed quality,
germination and purity standards, and
acceptable seed testing methods; and
update seed certification and
recertification requirements, including
new eligibility standards and the
recognition of current breeding
techniques. This rule aligns FSA
regulations with current industry
practices, harmonizes FSA testing
methods with industry standards, and
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SUMMARY:
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16:03 Jul 06, 2020
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clarifies confusing or contradictory
language in the existing regulations. The
revisions are expected to reduce trade
burden associated with interstate seed
commerce and encourage compliance
with State and Federal laws.
DATES: Effective August 6, 2020.
FOR FURTHER INFORMATION CONTACT:
Ernest Allen, Director, Seed Regulatory
and Testing Division, Science and
Technology Program, AMS, USDA; 801
Summit Crossing Place, Suite C,
Gastonia, NC 28054, USA; telephone:
704–810–8884; email Ernest.Allen@
usda.gov.
SUPPLEMENTARY INFORMATION: The FSA
(7 U.S.C. 1551–1611) regulates interstate
commerce of planting seeds for
agricultural and gardening purposes.
The FSA requires seeds to meet certain
germination rate, purity, and
certification standards. Under the FSA,
seeds must be truthfully labeled with
specific quality information. As well,
the FSA requires all persons shipping
agricultural seed in interstate commerce
to maintain records of seed variety,
origin, treatment, germination, and
purity. Regulations established under
the FSA (7 CFR part 201) (regulations)
implement the requirements of the FSA
and are administered by the
Agricultural Marketing Service (AMS).
From time to time, AMS finds it
necessary to update the regulations to
reflect current industry standards and
practices and to remove obsolete
references. AMS last updated the
regulations in 2011 (76 FR 31790). AMS
met with representatives of major seed
industry stakeholder organizations in
February 2019 to discuss possible
revisions to make the regulations more
reflective of current industry practices
and updated testing methods. Based on
stakeholder input, the Seed Regulatory
and Testing Division of AMS’s Science
and Technology Program initiated this
action to update the regulations.
AMS published a proposed rule in the
Federal Register on January 27, 2020
(85 FR 4603), describing proposed
revisions and updates to the regulations.
The proposed rule provided a 60-day
public comment period ending March
27, 2020. Seven comments were
submitted. After considering the
comments, AMS revised some of the
proposals based on those comments.
The comments and AMS’s responses are
discussed in detail in the Comments
section later in this document.
This final rule updates the lists of
seed kinds which are covered by the
regulations and revises the names of
several agricultural and vegetable seeds
to provide updated scientific
nomenclature. This rule further adds or
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40571
revises the definitions of other terms
used in the regulations to provide
greater clarity for regulated entities.
Other revisions in this rule update the
seed labeling, testing, and certification
requirements to reflect revised
terminology, as well as the evolution of
industry practices. Finally, this rule
makes several revisions of an
administrative nature to correct
misspellings and other errors in the
regulations. Specific revisions are
described below.
Revisions
Nomenclature
The regulations specify the kinds of
agricultural and vegetable seed that are
subject to regulation. This rule revises
the list of agricultural seed covered by
the regulation in § 201.2(h) by adding
camelina, radish, and teff to the list.
The revisions add radish to the list of
seed kinds for which the variety is
required on the label in § 201.10(a); add
camelina, radish, and teff to the list of
seed kinds for which sample weights are
specified in Table 1 to
§ 201.46(d)(2)(iii); add camelina, radish,
and teff to the list of seed kinds for
which germination requirements are
specified in Table 2 to § 201.58(c)(3);
add teff to the list of seed kinds for
which purity percentage tolerances are
increased in § 201.60(a)(1); and add
camelina, chickpea, hemp, radish, and
sunn hemp to the list of seed kinds for
which standards related to certification
are specified in Table 5 to § 201.76.
To assure clear market
communication about seeds, the
regulations use the Latin scientific
names assigned to plants in the
International Code of Nomenclature for
Cultivated Plants 1 and recognized
throughout the world. Occasionally, the
International Union of Biological
Science’s International Commission for
the Nomenclature of Cultivated Plants
revises those scientific names. This rule
further revises § 201.2(h) by updating
the scientific names for 15 agricultural
seed kinds already on the list (big
bluestem, mountain brome,
buffalograss, crambe, galletagrass,
guineagrass, forage kochia, browntop
millet, pearl millet, napiergrass, green
needlegrass, green panicgrass, bird rape,
turnip rape, and smilo), and by adding
another common name for sunn
crotalaria, one of the kinds already on
the list. The rule also updates the
scientific name for tomato, which is on
1 The International Code of Nomenclature for
Cultivated Plants (ICNCP or Cultivated Plant Code),
published by the International Society for
Horticultural Science. The ICNCP was most
recently updated in 2016.
E:\FR\FM\07JYR1.SGM
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Agencies
[Federal Register Volume 85, Number 130 (Tuesday, July 7, 2020)]
[Rules and Regulations]
[Pages 40569-40571]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-13683]
========================================================================
Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by the Superintendent of Documents.
========================================================================
Federal Register / Vol. 85, No. 130 / Tuesday, July 7, 2020 / Rules
and Regulations
[[Page 40569]]
FEDERAL RETIREMENT THRIFT INVESTMENT BOARD
5 CFR Parts 1605, 1650 and 1651
Correction of Administrative Errors; Required Minimum
Distributions
AGENCY: Federal Retirement Thrift Investment Board.
ACTION: Direct final rule.
-----------------------------------------------------------------------
SUMMARY: The Federal Retirement Thrift Investment Board (FRTIB) is
amending its regulations to make a non-substantive change to the
constructed share price formula for a retired Lifecycle (L) Fund. The
FRTIB uses a constructed share price to make error corrections
involving a retired L Fund. In addition, due to a recent change in the
Internal Revenue Code (Code), the FRTIB is amending its regulations to
change the age by which TSP participants must begin receiving
distributions from their TSP accounts from 70\1/2\ to 72.
DATES: Effective July 7, 2020. The change to the constructed share
price formula is applicable June 30, 2020, without further action,
unless adverse comment is received by August 6, 2020. If adverse
comment is received, FRTIB will publish a timely withdrawal of the rule
in the Federal Register. As required by the Code, the change to the age
by which TSP participants must begin receiving distributions from their
accounts is effective for distributions required to be made after
December 31, 2019, with respect to individuals who will reach age 70\1/
2\ after that date.
ADDRESSES: You may submit comments using one of the following methods:
Federal Rulemaking Portal: https://www.regulations.gov.
Follow the instructions for submitting comments.
Mail: Office of General Counsel, Attn: Megan G. Grumbine,
Federal Retirement Thrift Investment Board, 77 K Street NE, Suite 1000,
Washington, DC 20002.
Facsimile: Comments may be submitted by facsimile at (202)
942-1676.
Since March 23, 2020, the FRTIB has been operating under a
mandatory telework status due to the coronavirus pandemic which has
severely limited the ability to timely monitor mail and facsimiles.
Therefore, we strongly encourage using the Federal Rulemaking Portal to
submit comments.
FOR FURTHER INFORMATION CONTACT: Austen Townsend, (202) 864-8647.
SUPPLEMENTARY INFORMATION: The FRTIB administers the TSP, which was
established by the Federal Employees' Retirement System Act of 1986
(FERSA), Public Law 99-335, 100 Stat. 514. The TSP is a tax-deferred
retirement savings plan for Federal civilian employees and members of
the uniformed services. The TSP is similar to cash or deferred
arrangements established for private-sector employees under section
401(k) of the Internal Revenue Code (26 U.S.C. 401(k)).
Lifecycle Funds
In addition to its five core funds (the G, F, C, S, and I Funds)
the TSP offers multiple L Funds, each of which is made up entirely of
the five core funds in different, professionally determined,
proportions based on a particular time horizon, or target retirement
date. Each L fund is ``retired'' when it reaches its target date.
Currently, the TSP offers L Funds based on a 10-year asset
allocation. A 10-year L Fund must, by design, be retired on December
31st of year in which it reaches its target date. For example, the L
2010 reached its target date in 2010 and was retired on December 31,
2010.
Beginning July 1, 2020, the TSP will instead offer L Funds based on
a 5-year asset allocation to give TSP participants a more targeted
window of time to match their intended retirement date with their asset
allocation. As a result of the shift from 10-year to 5-year L Funds, L
Funds beginning with the L 2020 fund will be retired on June 30th of
the year in which they reach their respective retirement dates.
Correcting Errors Involving Retired L Funds
Once an L Fund is retired, TSP participants are no longer able to
make contributions to that fund. However, the FRTIB is sometimes
required to calculate lost earnings (i.e., breakage) on errors
involving these retired L Funds. Breakage is the loss incurred
(negative earnings) or the gain realized (positive earnings) on late
and makeup contributions. Similarly, the FRTIB must sometimes process
the removal of erroneous contributions (i.e., a negative adjustment)
previously made to a now-retired L Fund. The value of a negative
adjustment equals the amount of the erroneous contributions plus
earnings (positive or negative) on that amount.
Generally, the FRTIB uses the current share price of the applicable
investment fund when calculating breakage or the value of a negative
adjustment. Because a retired L Fund no longer exists, the FRTIB
instead uses a constructed share price in order to calculate breakage
or the value of negative adjustments on errors involving these funds.
The constructed share price for a retired L Fund is calculated
using the final posted share price of that L Fund (i.e., the share
price posted on the date the L Fund was retired). When the constructed
share price formula was created, all L Funds were based on a 10-year
asset allocation. Therefore, rather than referring to the L Fund's
final posted share price, the FRTIB's existing regulations provide that
the constructed share price for a retired Lifecycle fund is calculated
using the share price of the L Fund on December 31 of its retirement
year.
To account for the fact that L Funds will no longer be retired on
December 31st as a result of the shift from 10-year to 5-year L Funds,
the FRTIB is updating its regulations to remove the references to
December 31st in the constructed share price formula. Instead,
consistent with the FRTIB's original intent, the regulations will
simply refer to the final posted share price. The substance of the
formula remains unchanged.
Required Minimum Distributions
On December 20, 2019, the President signed into law the Setting
Every Community Up for Retirement Enhancement (SECURE) Act (Division O
pg. H.R. 1865-604), as part of the Further Consolidated Appropriations
Act of 2020 (Pub. L. 116-94). The SECURE Act amended the Code to change
the age by which TSP participants must begin receiving distributions
(referred to as required
[[Page 40570]]
minimum distributions (RMDs)) from their accounts from 70\1/2\ to 72.
The RMD rules under the Code, which apply to both separated TSP
participants and TSP beneficiary participants,\1\ set forth the date by
which participants must receive RMDs (i.e., the required beginning
date). Prior to the passage of the SECURE Act, the Code required
separated TSP participants to receive RMDs beginning on April 1 of the
year following the year in which the participant reached age 70\1/2\
and annually thereafter. TSP beneficiary participants were required to
receive RMDs beginning on the later of the end of the year following
the year in which the participant died, or the end of the year in which
the participant would have reached age 70\1/2\. TSP participants who
turned 70\1/2\ on or before December 31, 2019 remain subject to these
pre-SECURE Act required beginning date rules.
---------------------------------------------------------------------------
\1\ A beneficiary participant is a spouse beneficiary of a
deceased TSP participant who has a TSP beneficiary participant
account established in his or her name. In the case of a beneficiary
participant, the age of the deceased participant is used when
determining the date by which RMDs must commence.
---------------------------------------------------------------------------
Participants who had not reached age 70\1/2\ before January 1, 2020
are subject to the new required beginning date rules. Specifically, the
Code, as amended by the SECURE Act, requires a separated TSP
participant to receive RMDs beginning on April 1 of the year following
the year in which he or she reaches age 72 and is separated from
service and annually thereafter. TSP beneficiary participants must
receive RMDs beginning on the later of the end of the year following
the year in which the participant died, or the end of the year in which
the participant would have reached age 72.
The FRTIB is updating its regulations by removing the references to
age 70\1/2\ in the definition of ``required beginning date.'' The
updated regulations will instead define this term by incorporating by
reference the Code's definition of required beginning date. This
ensures that FRTIB regulations regarding RMDs will always be consistent
with the Code's requirements so that future amendments on short notice
may be avoided.
Regulatory Flexibility Act
I certify that this regulation will not have a significant economic
impact on a substantial number of small entities. This regulation will
affect Federal employees and members of the uniformed services who
participate in the Thrift Savings Plan, which is a Federal defined
contribution retirement savings plan created under the Federal
Employees' Retirement System Act of 1986 (FERSA), Public Law 99-335,
100 Stat. 514, and which is administered by the Agency.
Paperwork Reduction Act
I certify that this regulation does not require additional
reporting under the criteria of the Paperwork Reduction Act.
Unfunded Mandates Reform Act of 1995
Pursuant to the Unfunded Mandates Reform Act of 1995, 2 U.S.C. 602,
632, 653, 1501-1571, the effects of this regulation on state, local,
and tribal governments and the private sector have been assessed. This
regulation will not compel the expenditure in any one year of $100
million or more by state, local, and tribal governments, in the
aggregate, or by the private sector. Therefore, a statement under
section 1532 is not required.
Submission to Congress and the General Accounting Office
Pursuant to 5 U.S.C. 810(a)(1)(A), the Agency submitted a report
containing this rule and other required information to the U.S. Senate,
the U.S. House of Representatives, and the Comptroller General of the
United States before publication of this rule in the Federal Register.
This rule is not a major rule as defined at 5 U.S.C. 804(2).
List of Subjects
5 CFR Part 1605
Claims, Government employees, Pensions, Retirement.
5 CFR Part 1650
Alimony, Claims, Government employees, Pensions, Retirement
5 CFR Part 1651
Claims, Government employees, Pensions, Retirement.
Ravindra Deo,
Executive Director, Federal Retirement Thrift Investment Board.
For the reasons stated in the preamble, the FRTIB amends 5 CFR
chapter VI as follows:
PART 1605--CORRECTION OF ADMINISTRATIVE ERRORS
0
1. The authority citation for Part 1605 continues to read as follows:
Authority: 5 U.S.C. 8351, 8432a, 8432d, 8474(b)(5) and (c)(1).
Subpart B also issued under section 1043(b) of Public Law 104-106,
110 Stat. 186 and section 7202(m)(2) of Public Law 101-508, 104
Stat. 1388.
0
2. Amend Sec. 1605.2 by revising paragraph (b)(1)(iii) to read as
follows:
Sec. 1605.2 Calculating, posting, and charging breakage on late
contributions and loan payments.
* * * * *
(b) * * *
(1) * * *
(iii) Determine the dollar value on the posting date of the number
of shares the participant would have received had the contributions or
loan payments been made on time. If the contributions or loan payments
would have been invested in a Lifecycle fund that is retired on the
posting date, the constructed share price shall equal the final posted
share price of the retired Lifecycle fund, multiplied by the current L
Income Fund share price, divided by the L Income Fund share price on
the same date that the retired Lifecycle fund posted its final share
price. The dollar value shall be the number of shares the participant
would have received had the contributions or loan payments been made on
time multiplied by the constructed share price.
* * * * *
0
3. Amend Sec. 1605.12 by revising paragraph (c)(2)(ii) to read as
follows:
Sec. 1605.12 Removal of erroneous contributions.
* * * * *
(c) * * *
(2) * * *
(ii) Multiply the price per share on the date the adjustment is
posted by the number of shares calculated in paragraph (c)(2)(i) of
this section. If the contribution was erroneously contributed to a
Lifecycle fund that is retired on the date the adjustment is posted,
the price per share shall equal the final posted share price of the
retired Lifecycle fund, multiplied by the current L Income Fund share
price, divided by the L Income Fund share price on the same date that
the retired Lifecycle fund posted its final share price.
* * * * *
PART 1650--METHODS OF WITHDRAWING FUNDS FROM THE THRIFT SAVINGS
PLAN
0
4. The authority citation for Part 1650 continues to read as follows:
Authority: 5 U.S.C. 8351, 8432d, 8434, 8435, 8474(b)(5) and
8474(c)(1).
0
5. Amend Sec. 1650.1(b) by revising the definition for ``Required
beginning date'' to read as follows:
[[Page 40571]]
Sec. 1650.1 Definitions.
* * * * *
(b) * * *
Required beginning date means the required beginning date as
defined in Internal Revenue Code section 401(a)(9) and the regulations
and guidance promulgated thereunder.
* * * * *
PART 1651--DEATH BENEFITS
0
6. The authority citation for Part 1651 continues to read as follows:
Authority: 5 U.S.C. 8424(d), 8432d, 8432(j), 8433(e),
8435(c)(2), 8474(b)(5) and 8474(c)(1).
0
7. Amend Sec. 1651.1(b) by revising the definition for ``Required
beginning date'' to read as follows:
Sec. 1651.1 Definitions.
* * * * *
(b) * * *
Required beginning date means the required beginning date as
defined in Internal Revenue Code section 401(a)(9) and the regulations
and guidance promulgated thereunder.
* * * * *
[FR Doc. 2020-13683 Filed 7-2-20; 8:45 am]
BILLING CODE 6760-01-P