Current through Register Vol. 48, No. 38, September 20, 2024
a) In accordance with the applicable
provisions of the United States Internal Revenue Code and "An Act in relation
to State finance", approved June 10, 1919, as amended, the Board of Regents has
adopted a tax sheltered annuity plan for the employees of the Regency System to
be known as the Tax Deferred Annuity Plan.
b) Description of Plan
1) Approval of Companies
The Board of Regents will approve companies to write tax
deferred Annuity contracts under this plan.
2) Conditions of Agreement with Employees
Each person now employed or hereafter employed by the Board of
Regents shall, while this plan remains in effect, have the privilege of
electing to participate in the Tax Deferred Annuity Plan in consideration for
which the Board of Regents shall pay the amount of such adjustment in earnings
to any one insurance company approved by the Board of Regents, as hereinafter
provided, to be applied as a premium on an annuity contract under which the
employee's rights are non-forfeitable except for failure to pay future
premiums.
A) Each employee who desires
to participate in the plan shall elect to do so in writing on forms provided by
the University's insurance office or other designated office.
B) New employees of the Board of Regents who
have a tax-deferred plan (excluding any life insurance) purchased through a
previous employer from a company which is not on the Regency System approved
list of companies may exercise one of two options:
i) Suspend contributions to that company
leaving prior contributions on deposit until retirement age or
ii) exercise a tax-rollover permitted by
Internal Revenue Service which permits direct transfer of tax-deferred annuity
contributions from one company to a company on the Regency System approved list
without making the transferred contributions reportable income in the year of
transfer.
C) Any such
election to participate in this program shall become effective as soon as
possible, but no later than 30 days after the date on which the election form
is delivered to the applicable insurance office.
D) An employee may revoke participation only
in accordance with applicable Federal and State law with such revocation to be
effective as soon as possible but not later than the first payroll period
following thirty (30) days after the date of written revocation.
3) Conditions of Approval
Affecting Participating Companies
A) All
tax-deferred annuity contracts issued must comply with the United States
Internal Revenue Code, as amended. Participating companies must be authorized
by the Director of Insurance of the State of Illinois to issue tax-deferred
annuity contracts.
B) All monies
withheld through agreements between the Board and the employee will be used to
purchase only qualified tax-deferred annuity contracts and will exclude waiver
of premium provisions, disability income provisions, and life
insurance.
C) Upon request the
company must provide the Secretary of the Board of Regents all information
about its contracts including, but not limited to, all charges and commissions
schedules, and must agree that this information may be made available to
employees on a comparative basis with other companies. A principal officer of
the company will attest to the accuracy of the information provided.
4) Administration of Tax-Deferred
Annuity Plan
A) This plan shall be
administered by the Secretary of the Board of Regents who shall have the
authority to prescribe such additional rules not inconsistent herewith, as are
deemed appropriate for accomplishing the purposes herein set forth.
B) Neither the Board of Regents, nor any
representative thereof, will recommend any one qualified company.
C) Upon receipt of documented evidence of any
violation of Board regulations pertaining to tax-deferred annuities by a
representative of an approved company, the Secretary may prohibit the issuance
of any additional agreements to Regency employees for an indefinite period of
time appropriate to the seriousness of the violation.
D) The Board will notify the approved company
of the violation of its Regulations and will include a copy of the specific
regulation violated. It will give the company 60 days to respond to the notice
of violation, including the actions it will take to prevent a repetition of the
violation. The response will be reviewed by the Board. If the Board is
satisfied that the company has taken corrective action to prevent a recurrence
of the violation, no penalty will be imposed. If the Board feels that the
company has not taken corrective action to prevent a recurrence of the
violation, the privilege of selling tax deferred annuity contracts may be
suspended for a minimum of 60 days.
