Current through Register Vol. 49, No. 9, September, 2024
DEFINITIONS
1.
Refund beneficiary means a
person(s) designated by the member in writing on file with ATRS to receive the
member's accumulated contributions standing to his or her credit in the
member's deposit account at the time of the member's death, together with
regular interest thereon from the time of death to the time of
payment.
2.
Residue
beneficiary means a person(s) designated by the member in writing on
file with ATRS to receive the residue amount, if any, at the termination of the
survivor benefit annuities payable on account of the member's death under
§
24-7-711.
3.
Residue
means the amount of the member's accumulated contributions, including
regular interest, standing to the member's credit in the members' deposit
account at the time of his/her death
RULES
If an active member with five (5) or more years of actual and
reciprocal service, including credited service for the year immediately
preceding his or her death, dies in employer service before retirement,
survivor benefits as provided in A.C.A. §
24-7-710 shall be paid to the
following qualifying dependents:
1.
SPOUSE
A. The member's surviving
spouse, who was married to the member for at least the two (2) years
immediately prior to the member's death, shall receive a surviving spouse
annuity.
B. If at f the member's
death there are no dependent children eligible to receive a dependent child
annuity under §
24-7-710, a surviving spouse who qualifies to receive a
surviving spouse annuity may file with the System a written waiver of any
rights to the spouse annuity,.
If the surviving spouse files a waiver of the spouse annuity, the
deceased member's residue beneficiary(ies) will receive a single distribution
of the member's residue amount, if any..
C. The surviving spouse annuity shall
commence when the spouse reaches age 62 and is payable until the spouse's
remarries or dies.
D. However, if
the member, prior to his of her death, had:
i.
Satisfied the age and service requirements provided for in §
24-7-701 or
had acquired twenty (20) years of credited service before his/her death, the
spouse annuity shall be payable immediately and be payable for the spouse's
life; or
ii. Acquired fifteen (15)
years of credited service but had not attained age sixty (60) before his/her
death, then the surviving spouse annuity shall commence at age 50 and be
payable until the spouse remarries or dies.
E. Amount of Surviving Spouse Annuity
The surviving spouse annuity shall be calculated as if the member
retired the date of his /her death under §
24-7-705 and elected Option A,
nominating his/ her spouse as the Option A beneficiary.
However if the amount payable to the surviving spouse under
Option A is less than the amount payable to dependent children as provided in
this Policy, the greater of the two annuities shall be paid.
F. If a surviving spouse does not otherwise
qualify for a spouse annuity but has in his/her custody any of the deceased
member's dependent children receiving a dependent child annuity under No. 2
below, a spouse annuity shall be paid to the spouse in the same amount payable
to the dependent children under No. 2 below. The annuity paid to the custodial
spouse will begin immediately and continue until all the dependent child
annuities terminate or the spouse no longer has custody of the dependent
children.
To be considered to have "custody" of a dependent child, the
spouse must be the primary custodian of the dependent child(ren), having at
least 50% custody.
2.
DEPENDENT CHILDREN
An active member's dependent children shall each receive a
surviving child annuity upon the member's death. The surviving child annuity
shall be calculated according to the following:
A
i. If the
member had only contributory credited service, the greater of ten percent (10%)
of the member's salary for the fiscal year at the time of death or fifty
dollars ($50.00) monthly, plus the benefits applicable under §
24-7-713.
ii. If the member had
only noncontributory credited service, the greater of six percent (6%) of the
member's salary for the fiscal year at the time of death or thirty-one dollars
($31.00) monthly, plus the benefits applicable under §
24-7-713; or
iii. If the member had a mixture
of credited service, the amount payable shall be prorated between the member's
contributory and noncomtributory credited service and his/ her total credited
service monthly, plus the benefits applicable under §
24-7-713.
B. If there are three
(3) or more dependent children, each dependent child shall receive an annuity
in the amount of :
i. If the member had only
contributory credited service, the greater of twenty-five percent (25%) of the
member's salary for the fiscal year at the time of his/her death or one hundred
twenty-five dollars ($125) monthly, plus the benefits applicable under §
24-7-713.
ii. If the member had
only noncontributory credited service, the greater of 16% of the member's
salary for the fiscal year at the time of his/her death or $79.00 monthly, plus
the benefits applicable under §
24-7-713.
iii. If the member had a mixture of credited
service, the amount payable shall be prorated between the contributory credited
service and the noncontributory service and his/her total credited service,
plus the benefits applicable under §
24-7-713.
C. A "child" of a member is defined in A.C.A.
§
24-7-202(9) as:
i. A natural child of
the member;
ii. A child that has
been made a child of the member by adoption or other court action prior to the
time of the death of the member; or
iii. A child under the permanent care of the
member at the time of death of the member, which permanent care status shall be
determined under Rule 2D of this policy.
D. To be a "dependent child" under these
rules, the child must:
i. Meet requirements
and qualify for survivor benefits under Social Security;
ii. Have been claimed as a dependent by the
deceased member on his federal income tax for the immediately preceding
calendar year; and
iii. Have lived
in the same household for at least two (2) years immediately preceding death of
the member, unless the child is under two years of age.
E. A child identified as a dependent will
remain eligible to receive a survivor annuity until he/she is no longer a
dependent. A child is no longer dependent if he/she reaches the age of 18 or
becomes legally married.
F. A
deceased member's child will continue to be eligible for a child survivor
annuity after reaching age 18 if the child continues consecutively, without
interruption, as a full-time student at an accredited secondary or
postsecondary school (vocational technical school) or college or university. In
any event, a dependent child annuity will terminate when the child reaches age
23.
i. A full-time student is defined as one
carrying 12 semester or 8 trimester hours in college or four (4) hours per day
in a secondary or postsecondary school.
ii. If a child who is receiving a dependent
child annuity is age 18 or older but becomes temporarily physically or mentally
incapacitated, the Board may continue paying benefits upon receipt of a
doctor's certification that the child is not competent to attend school for the
period of one semester or term. At the beginning of the next semester or term,
if the child does not reenter school full-time, the annuity payable to a
dependent child under A.C.A. §
24-7-710 (c) will terminate.
iii. Certification of attendance in an
accredited school may be made by the dependent child in the absence of a parent
or legal guardian after the dependent child reaches age 18.
G. A deceased member's dependent
child who is dependent due to having been adjudged physically or mentally
incapacitated by a court or legal tribunal continues to be eligible to receive
a dependent child annuity as long as the incapacity exists, regardless of
age.
H. When a child ceases to be a
dependent child, his/her annuity shall terminate, and there shall be a
recalculation of the annuities due to the remaining, dependent
children.
I. A dependent child
annuity will be paid as separate payments to each child monthly, rather than
one lump-sum check payable to the spouse or custodian. Deposit accounts
designated to receive survivor annuity payments to a child under age 18 must
qualify as custodial accounts in accordance with the Uniform Transfers to
Minors Act.
3.
DEPENDENT PARENT
If at the time of an active member's death, there is no a
surviving spouse or dependent child eligible to receive a survivor annuity,
each dependent parent shall receive a dependent parent annuity in the amount
payable to dependent children under No. 2 of this policy.
A parent is dependent upon the member if he/she is dependent for
at least fifty percent (50%) of his or her financial support from the
member.
A parent is considered 50% dependent for financial support on the
deceased member if the parent's annual income was not greater than the amount
contributed by the deceased member for his or her support.
4.
COMMENCEMENT OF ANNUITIES
Annuities payable under the provisions of this rule shall
commence the calendar month following the date the survivor becomes eligible to
receive the survivor annuity under §
24-7-710.
5.
REPAYMENT OF AMOUNTS DUE FROM
DECEASED MEMBER
In the event a deceased member received benefits from the System
which he/she was not due and had failed to repay the amount prior to his/her
death, the amount still payable to the System shall be withheld from the
survivor annuities payable until the amount owed to the System is repaid in
full..
6.
DISPOSITION
OF RESIDUE AFTER SURVIVOR ANNUITIES TERMINATE [(A.C.A. §
24-7-710(e)]
A. If upon the member's
death, no survivor annuity becomes payable under §
24-7-710, then the
residue amount, if any, shall be paid to according to No.7 of this
policy.
B. If a survivor annuity is
payable under §
24-7-710, but the survivor annuities terminate before
there has been paid to the survivor annuitants, an amount equal to the residue
amount, the remaining residue, if any, shall be paid to the member's designated
residue beneficiaries.
C. After
June 30, 2006, if there are no designated residue beneficiaries surviving an
active member at his/her death, the residue shall be payable to the member's
estate.
D. If the designated
residue beneficiary survives both the member and the recipient of the survivor
benefit annuities but dies prior to receiving the residue, the residue shall be
payable to the last eligible, eligible survivor annuitant's estate.
7.
DISPOSITION OF RESIDUE
CONTRIBUTIONS
A. In the event a member
dies and no survivor annuity becomes payable by the System upon the member's
death, the residue, if any, shall be paid to the member's designated residue
beneficiaries.
B. If there are no
designated residue beneficiaries surviving the member, the residue remaining,
if any, shall be paid to the member's estate.
C. If at the time of an active member's
death, a surviving spouse is listed on the death certificate, the System will
search for the surviving spouse for up to one year. If after one year, ATRS has
not located or been contacted by the surviving spouse, ATRS will refund the
member's residue amount, if any, to the member's remaining residue
beneficiaries surviving the member.
8.
SURVIVOR BENEFITS UPON DEATH OF
DISABILITY APPLICANT
If an active member dies after applying for disability
retirement, the following will apply:
A. If the member dies before receipt of the
first disability retirement check but after receiving final approval for
disability retirement, the benefits will be paid under the disability
retirement option selected by the member.
B. If the member dies after the disability
application is received by the System but before disability retirement is
approved, then the System shall consider the member to have died in "active"
service and survivor benefits under §
24-7-710 shall be paid.
9.
MEMBER' S SALARY USED IN
CALCULATING SURVIVOR ANNUITIES
For the purposes of determining survivor benefits, the member's
salary shall be the salary that the member would have received in the fiscal
year in which he/she died had the member lived through the end of the fiscal
year.
10.
INCLUSION
OF POST-DEATH PAYMENTS AS SALARY AND DAYS OF SERVICE
Salary payments made after the death of a member that were earned
prior to death are subject to System deductions and shall be reported in total
salary and days of service in the employer's quarterly report. Payments made by
an employer after the death of an active member that are made as a mere
gratuity and were not earned by the member shall not be included in the
member's salary reported to the System and are not subject to
deductions.
11.
CONTINUATION OF ACTIVE MEMBERSHIP STATUS
For purposes of survivor benefits, a member will be considered
active or an additional fiscal year following the last fiscal year that actual
service was rendered to a covered employer.
12.
DEATH BENEFITS PAYBLE BY MORE THAN
ONE RECIPROCAL SYSTEM
If survivor benefits are payable by more than one reciprocal
system to eligible survivors of a deceased member, the survivors shall not
receive more as a percentage of the deceased member's final pay or as a minimum
dollar amount than the largest amount payable by a single, reciprocal system.
The System will prorate minimum benefits payable with any other reciprocal
systems that have a minimum benefit provision in its plan. Each reciprocal
system shall pay only its proportionate share of the minimum amount based on
the ratio of service in its system to the total service in all reciprocal
systems.
13.
ACT 793
TRANSFERS
When the member elects to transfer from ATRS to APERS under the
provisions of Act 793 of 1977, APERS' law governs the survivors' eligibility
for a payment of residue or survivor benefits upon the member's death.
LUMP-SUM DEATH BENEFIT
(Act 1022 of 1997, Act 312 of 1999, Act 359 of 2001, Act 494 of
2005, Act 296 of 2007) (A.C.A. §
24-7-720)
DEFINITIONS
1.
Statutory succession means
the order in which benefits are paid if there are no designated beneficiaries
surviving the member or retirant who dies on or before June 30, 2006: spouse;
then children; then parents; then estate.
2.
Designated lump-sum death
beneficiary means a person(s) or entity(s) a member or retiree has
designated in writing on file with ATRS to receive the lump-sum death benefit
payable under A.C.A. §
24-7-720.
3.
Person includes a
corporation, partnership or other legal entity.
RULES
Effective July 1, 1997, Act 1022 of 1997 provides a lump-sum
death benefit for certain active and retired members.
1.
A. If
prior to July 1, 2007, an active member of the Arkansas Teacher
Retirement System with five (5) or more years of actual service,
including service for the year immediately preceding the member's death, dies
while in employer service before retirement, then a lump sum shall be paid to
the member's designated lump-sum death beneficiary(ies).
B. If on or after July 1, 2007, an active
member of the Arkansas Teacher Retirement System with ten (10) or more years of
actual service, including service for the year immediately preceding the
member's death, dies while in employer service before retirement, then a lump
sum shall be paid to the member's designated lump-sum death
beneficiary(ies).
C. Effective for
members dying on or before June 30, 2006, if there are no such designated
beneficiaries surviving the member, the lump sum shall be paid in the order of
statutory succession. Effective for members dying after June 30, 2006, if there
are no such designated beneficiaries surviving the member, the lump sum shall
be paid to the retirant's estate.
D.
i.
If the member had only contributory service, then the lump sum
payable shall be ten thousand dollars ($10,000.00);
ii. If the member had only noncontributory
service, then the lump sum payable shall be six thousand six hundred and
sixty-seven dollars ($6,667.00).
iii. If the member had a combination of
actual service, both contributory and noncontributory, the lump sum will be
prorated according to the ratio of the member's contributory and
noncontributory service.
2.
A. If
prior to July 1, 2007, a retirant whose annuity is paid by the Arkansas Teacher
Retirement System dies, a lump sum shall be paid to any designated lump-sum
death beneficiary.
B. If on or
after July 1, 2007, a retirant with ten (10) or more years of actual service
whose annuity is paid by the Arkansas Teacher Retirement System dies, then a
lump sum shall be paid to the member's designated lump-sum death
beneficiary(ies).
C. Effective for
retirants dying on or before June 30, 2006, if there are no such designated
beneficiaries surviving the retirant, the lump sum shall be paid in the order
of statutory succession. Effective for retirants dying after June 30, 2006, if
there are no such designated beneficiaries surviving the retirant, the lump sum
shall be paid to the retirant's estate.
D.
i.
If the retirant had only contributory service, then the lump sum
payable; shall be ten thousand dollars ($10,000.00);
ii. If the retirant had only noncontributory
service, then the lump sum payable shall be six thousand six hundred and
sixty-seven dollars ($6,667.00).
iii. If the retirant had a combination of credited service, both
contributory and noncontributory, the lump sum will be prorated according to
the ratio of the retirant's contributory and noncontributory service.
3. The Board of
Trustees sets the exact amount of the lump-sum payments up to the statutory
limits as it determines is actuarially appropriate for the System.
4. The Board of Trustees is authorized to set
the level of the lump-sum benefit to the current members and retirants where
the ratio between the contributory and noncontributory benefits are maintained
at a three-to-two (3:2) ratio and to a level to match the benefits that the
Board finds are appropriate for the actuarial soundness of the
System.
5. The lump-sum payments
shall be directly payable from the System upon receipt and acceptance of the
lump-sum death benefit application, member or retirant's original death
certificate, copy of the recipient's Social Security card or Form W-9, and such
other documentation required by ATRS.
6, The Arkansas Teacher Retirement System shall honor any and all
federal and state income tax laws regarding the payment of lump-sum death
benefits.
Amended: June 15, 2004
February 7, 2006 April 26, 2007
