Current through Register Vol. 50, No. 9, March 1, 2024
RELATES TO:
KRS
16.505(36), (37), (38),
16.576,
16.645(5),
61.510(37),
(38), (39),
61.690,
78.510(34),
(35), (36),
78.545(26),
205.712,
26 U.S.C.
414(p)
NECESSITY, FUNCTION, AND CONFORMITY:
KRS
61.690 requires the retirement systems to
promulgate an administrative regulation establishing the requirements,
procedures, and forms necessary to administer qualified domestic relations
orders (QDROs). This administrative regulation establishes the requirements,
procedures, and forms necessary to administer QDROs.
Section 1. Definitions.
(1) "Alternate payee" is defined by
KRS
16.505(38),
61.510(39),
and
78.510(36).
(2) "Qualified domestic relations order" is
defined by
KRS
16.505(37),
61.510(38),
and
78.510(35).
(3) "Participant" is defined by
KRS
16.505(36),
61.510(37),
and
78.510(34).
Section 2. The provisions of this
section shall only apply to QDROs that were approved by the retirement systems
for enforcement prior to July 14, 2000. After the participant notifies the
retirement system of the participant's requested effective retirement date, the
retirement systems shall administer a QDRO that was entered prior to the
participant's retirement as follows:
(1) The
retirement systems shall send the participant and the alternate payee
information regarding the amount of the benefits payable pursuant to the
QDRO.
(2) The amount of the
benefits payable pursuant to a QDRO approved for enforcement by the retirement
systems prior to July 14, 2000, shall be calculated as follows:
(a) The alternate payee shall receive the
amount computed by multiplying the basic option amount due the participant by
the percentage allocated to the alternate payee by the terms of the QDRO
multiplied by a fraction, the numerator of which shall be the period of service
specified in the QDRO and the denominator of which shall be the participant's
total service credit. The participant shall be paid all amounts in excess of
the amounts paid to the alternate payee.
(b) If a lump sum payment equal to the
balance of the participant's account is to be made, the percentage determined
by this calculation shall be multiplied by the balance of the participant's
account and the result paid to the alternate payee. The participant shall be
paid all amounts in excess of the amounts paid the alternate payee.
(c) If a monthly benefit is paid, the options
made available to the alternate payee shall be derived from the participant's
basic option.
(d) Service added for
disability under
KRS
61.605 or
16.582
shall not be included in determining the amount payable to the alternate payee.
Service credit purchased during the period of marriage shall be included in the
calculation under this paragraph.
(e) The payment options offered to the
alternate payee shall be based on the alternate payee's life expectancy. The
alternate payee shall be offered the payment options described in
KRS
61.635, which do not provide lifetime
benefits to a beneficiary and, if the participant is eligible, the ten (10)
year certain option as provided by
KRS
16.576(4).
(f) If the alternate payee predeceases the
participant after the participant's retirement, a lump sum, determined
actuarially, of the payments remaining to the alternate payee, if any, shall be
paid to the alternate payee's estate.
(g) The alternate payee of a QDRO approved
for enforcement by the retirement systems prior to July 14, 2000, shall receive
increases given recipients under
KRS
61.691.
(3) If the participant dies prior to
retirement and prior to the death of the alternate payee, the participant's
account shall be divided in accordance with the QDRO between the alternate
payee and the beneficiary.
(4) If
the death benefit is a refund of the participant's accumulated contributions
and interest, the alternate payee shall only be offered a lump sum payment
representing a portion of the participant's account calculated in accordance
with subsection (2) of this section.
(5) If the death benefit is calculated under
KRS
16.578 or
61.640,
the alternate payee shall be allowed to choose a lifetime annuity, a sixty (60)
month certain payment, a 120 month payment, or an actuarial lump sum
payment.
(6) If the alternate payee
dies prior to the participant's death, retirement, or withdrawal of account,
payment shall not be made to the alternate payee.
(7) When benefits become payable to the
alternate payee, the retirement system shall establish a separate account for
the alternate payee, which shall consist of the alternate payee's pro rata
share of the participant's contributions, service, and benefit. Once the
alternate payee's account has been established, the alternate payee shall not
be entitled to further benefits acquired by the participant.
Section 3.
(1) All sections of this administrative
regulation, except for Section 2, shall only apply to QDROs approved for
enforcement by the retirement systems on or after July 15, 2010.
(2) A QDRO may apply to any retirement
systems administered by the Kentucky Retirement Systems as established by KRS
Chapters 16, 61, and 78 in which the participant is a member during the period
of the marriage that is the subject of the QDRO and from which the participant
will receive retirement benefits, except for the retirement systems established
by
KRS
16.568,
61.663,
and
78.652.
(3) A QDRO shall contain the following
information:
(a) The participant's
name;
(b) The participant's mailing
address;
(c) The participant's
Kentucky Retirement Systems member identification number or the participant's
Social Security number;
(d) The
alternate payee's name;
(e) The
alternate payee's mailing address;
(f) The system or systems to which the QDRO
applies;
(g) The amount or
percentage to be paid to the alternate payee;
(h) When payments under the QDRO are to end;
(i) How the cost of living
increase provided in
KRS 61.691
is to be administered, if administration is not otherwise provided for by
KRS
61.690; and
(j) All information required on the form that
applies to the subject matter of the order:
1.
Form 6434, Pre-Retirement Qualified Domestic Relations Order for Division of
Marital Property;
2. Form 6435,
Post-Retirement Qualified Domestic Relations Order for Division of Marital
Property;
3. Form 6436, Qualified
Domestic Relations Order for Child Support;
4. Form 6437, Qualified Domestic Relations
Order for Child Support by an Administrative Agency; or
5. Form 6438, Qualified Domestic Relations
Order for Alimony/Maintenance.
Section 4.
(1) The participant shall sign and submit a
Form 6433, Authorization for Release of Information and Request for Information
for Qualified Domestic Relations Order to obtain the information necessary for
the Court to calculate the amount due to the alternate payee for purposes of
the QDRO. The participant shall provide the retirement systems with the
following information:
(a) The participant's
and the alternate payee's Social Security numbers;
(b) The participant's and the alternate
payee's dates of birth;
(c) Date of
marriage;
(d) Date of
divorce;
(e) The participant's and
the alternate payee's mailing addresses; and
(f) The addresses of the participant's and
the alternate payee's legal counsel, if any.
(2) If the participant has not yet retired,
the retirement systems shall provide as of the date of the divorce, the
participant's:
(a) Accumulated contributions
and interest contributed and earned during the marriage in each system in which
the participant has marital service;
(b) Total number of months of service credit
earned and purchased as of the effective date of the divorce or upon the
request in each system in which the participant has service;
(c) The number of months of service credit
earned and purchased during the marriage in each system in which the
participant has marital service;
(d) The hypothetical monthly retirement
benefit pursuant to
KRS
61.595 the participant would receive when the
participant is eligible for an unreduced retirement benefit based on the final
compensation and service credit as of the effective date of the divorce or upon
the request in each system in which the participant has marital service;
and
(e) The hypothetical actuarial
refund payment option or lump-sum refund payment the participant would receive
when the participant is eligible for an unreduced benefit based on the final
compensation and service credit as of the effective date of the divorce or upon
the request in each system in which the participant has marital
service.
(3) The
retirement systems shall use the participant's final compensation as of the
date of the divorce or upon the request and the service credit accrued by the
participant during the marriage or upon the request when calculating the
participant's projected basic monthly retirement allowance and the projected
actuarial refund or lump-sum refund payment.
(4) If the participant retired prior to the
effective date of the divorce, the retirement systems shall provide the
participant's:
(a) Current monthly retirement
benefit in each system from which the participant is receiving a monthly
retirement benefit;
(b) Total
number of months of service credit earned and purchased during the marriage in
each system from which the participant is receiving a monthly retirement
benefit; and
(c) Total number of
months of service credit in each system from which the participant is receiving
a monthly retirement benefit.
(5) The alternate payee may request and
obtain the information necessary for the court to calculate the amount due to
the alternate payee for purposes of the QDRO by submitting a Form 6433,
Authorization for Release of Information and Request for Information for
Qualified Domestic Relations Orders, and an attached court issued subpoena or
order compelling the release of the requested information.
(6) If information other than the information
supplied by the retirement systems in accordance with subsections (2) through
(4) of this section is required:
(a) The
participant shall submit to the systems an additional signed request for
information in writing; or
(b) The
alternate payee shall submit to the systems an additional request and an
attached court issued subpoena or order compelling the release of the requested
information.
(c) Requests for
information other than the information supplied by the retirement systems in
accordance with subsections (2) through (4) of this section shall be answered
pursuant to
KRS
61.661.
Section 5.
(1) A QDRO shall be on the form incorporated
by reference in this administrative regulation that applies to the subject
matter of the order.
(2) A QDRO
shall be signed by the judge of a court with jurisdiction over the case or by
the head of the administrative agency, or their designee, with statutory
authority to issue a QDRO.
(3) A
QDRO shall be entered and certified by the Clerk of the Court or by the head of
the administrative agency, or their designee, with statutory authority to issue
a QDRO.
(4) The participant,
alternate payee, or their legal counsel shall submit a copy of the entered and
certified QDRO to the retirement systems.
(5)
(a) The
participant, alternate payee, or their legal counsel shall not submit a QDRO
that is before an appellate court and is not final.
(b) The retirement systems shall not have
responsibility or liability for payments made pursuant to a QDRO submitted in
violation of this subsection that was altered or dissolved by an order of an
appellate court of competent jurisdiction.
(6) The participant, alternate payee, or
their legal counsel shall submit a certified check or money order in the amount
of fifty (50) dollars made payable to the Kentucky State Treasurer as a
nonrefundable processing fee with the QDRO. The retirement systems shall not
review the QDRO unless the fee is submitted with the QDRO.
(a) A QDRO shall provide who shall pay the
fee, including if the fee is to be divided between the participant and the
alternate payee. Only one (1) certified check or money order shall be submitted
in payment of the fee.
(b) There
shall not be a fee required for submission of a Form 6436, Qualified Domestic
Relations Order for Child Support or a Form 6437, Qualified Domestic Relations
Order for Child Support by an Administrative Agency.
(c) If the dissolution of marriage action was
filed in forma pauperis, then the retirement systems shall waive the filing
fee. A copy of the order allowing the dissolution of marriage action to be
filed in forma pauperis shall be submitted to the retirement systems with the
entered and certified QDRO.
(7) If the retirement systems determines that
the QDRO does not comply with
KRS
61.690,
26 U.S.C.
414(p), or this
administrative regulation the participant, alternate payee, or their legal
counsel shall have ninety (90) days from the date the retirement systems'
notification of the deficiency was mailed as provided in Section 6(4) of this
administrative regulation to submit a corrected QDRO. If a corrected QDRO is
not submitted within ninety (90) days of the date of notification then the
participant, alternate payee, or their legal counsel shall be required to
submit an additional nonrefundable fifty (50) dollar fee with a QDRO submitted
after ninety (90) days.
Section
6.
(1) The retirement systems
shall determine if the QDRO is complete and qualifies as a QDRO pursuant to
KRS
61.690,
26 U.S.C.
414(p), and this
administrative regulation.
(a) A QDRO shall
not be effective until the retirement systems has determined that it complies
with
KRS
61.690,
26 U.S.C.
414(p), and this
administrative regulation and has approved the QDRO for enforcement.
(b) The retirement systems shall provide
notification of its determination within ninety (90) days of the submission of
the QDRO during the time period from July 15, 2010 until July 14,
2011.
(c) The retirement systems
shall provide notification of its determination within forty-five (45) days of
the submission of the QDRO after July 15, 2011.
(2) The retirement systems shall notify the
participant; the participant's legal counsel, if known; the alternate payee;
and alternate payee's legal counsel, if known, that the QDRO has been approved
for enforcement.
(a) If the participant has
not yet retired, the retirement systems shall place the QDRO on file until the
participant files a notification of retirement or an application for
refund.
(b) If the participant has
retired, the retirement systems shall begin to enforce the QDRO the month after
it is approved for enforcement by the retirement systems.
(3) The alternate payee shall submit a
completed Form 6130, Authorization for Deposit of Retirement Payment, or a Form
6135, Payment of Retirement Payment by Check, prior to receiving payment under
a QDRO. If the alternate payee has not submitted a completed Form 6130,
Authorization for Deposit of Retirement Payment, or a Form 6135, Payment of
Retirement Payment by Check, by the last day of the month before the first
payment under the QDRO is due to be paid to the alternate payee, the retirement
systems shall:
(a) Segregate and hold the
alternate payee's payments;
(b)
Hold the segregated amount for a period of no more than eighteen (18) months,
with the period beginning on the date the first payment was required by the
QDRO approved for enforcement by the retirement systems;
(c) Pay the segregated amount to the
alternate payee, if a valid Form 6130, Authorization for Deposit of Retirement
Payment, or a Form 6135, Payment of Retirement Payment by Check, is submitted
within the eighteen (18) month period;
(d) Pay the segregated amount to the
participant, if a valid Form 6130, Authorization for Deposit of Retirement
Payment, or a Form 6135, Payment of Retirement Payment by Check, is not
submitted within the eighteen (18) month hold period; or
(e) Apply the QDRO prospectively, if after
the eighteen (18) month hold period expires a valid Form 6130, Authorization
for Deposit of Retirement Payment, or a Form 6135, Payment of Retirement
Payment by Check, is submitted.
(4) If the retirement systems determines that
the QDRO does not comply with
KRS
61.690,
26 U.S.C.
414(p), or this
administrative regulation, the retirement systems shall notify the participant,
the participant's legal counsel, if known, the alternate payee, and alternate
payee's legal counsel, if known, that:
(a)
The retirement systems has determined the QDRO does not comply with
KRS
61.690,
26 U.S.C.
414(p), or this
administrative regulation;
(b) The
reason for the determination that the QDRO does not comply with
KRS
61.690,
26 U.S.C.
414(p), or this
administrative regulation; and
(c)
The changes necessary to make the QDRO in compliance with
KRS
61.690,
26 U.S.C.
414(p), and this
administrative regulation.
Section 7.
(1) If a QDRO approved for enforcement and on
file at the retirement systems is amended or terminated, the participant,
alternate payee, or their legal counsel shall submit the amended entered and
certified QDRO or an entered and certified order terminating the QDRO to the
retirement systems as provided in Section 5 of this administrative
regulation.
(2) The participant,
alternate payee, or their legal counsel shall submit a certified check or money
order in the amount of twenty-five (25) dollars made payable to the Kentucky
State Treasurer as a nonrefundable processing fee for the amended QDRO or order
terminating the QDRO. The retirement systems shall not review the amended QDRO
or order terminating the QDRO unless the fee is submitted with the amended QDRO
or order terminating the QDRO.
(a) If the
dissolution of marriage action was filed in forma pauperis, then the retirement
systems shall waive the filing fee. A copy of the order allowing the
dissolution of marriage action to be filed in forma pauperis shall be submitted
to the retirement systems with the entered and certified QDRO.
(b) There shall not be a fee required for
submission of a Form 6436, Qualified Domestic Relations Order for Child
Support, or a Form 6437, Qualified Domestic Relations Order for Child Support
by an Administrative Agency.
(3) The retirement systems shall review the
amended QDRO using the same procedures found in Section 6 of this
administrative regulation.
(4) If
the retirement systems determines that the amended QDRO does not comply with
KRS
61.690,
26 U.S.C.
414(p), and this
administrative regulation or that the order terminating the QDRO is
insufficient the participant, alternate payee, or their legal counsel shall
have ninety (90) days from the date the retirement systems' notification of the
deficiency was mailed as provided in Section 6(4) of this administrative
regulation to submit a corrected amended QDRO or a corrected order terminating
the QDRO. If a corrected amended QDRO or a corrected order terminating the QDRO
is not submitted within ninety (90) days of the date of notification, then the
participant, alternate payee, or their legal counsel shall be required to
submit an additional nonrefundable twenty-five (25) dollar fee with an amended
QDRO or order terminating the QDRO that is submitted after ninety (90)
days.
(5) An amended QDRO or an
order terminating a QDRO approved by the retirement systems shall only be
administered prospectively.
Section
8. All fees collected pursuant to this administrative regulation
shall be deposited in the Retirement Allowance Account established in
KRS
61.580.
Section
9.
(1) A QDRO issued for
purposes of division of the participant's retirement account pursuant to a
divorce entered prior to the participant's effective retirement date shall be
submitted on the Form 6434, Pre-Retirement Qualified Domestic Relations Order
for Division of Marital Property, unless the QDRO is initially submitted
following the participant's retirement date.
(2) The effective date of the Form 6434,
Pre-Retirement Qualified Domestic Relations Order for Division of Marital
Property, shall be the participant's effective retirement date as provided in
KRS
61.590 or, if the Form 6434 is approved
following the participant's effective retirement date, the month following the
month the Form 6434 was approved for enforcement by the retirement systems. If
the participant receives a lump sum payment representing monthly retirement
benefits paid retroactively to the participant's effective retirement date, the
alternate payee shall receive a portion of the lump sum payment as provided in
the Form 6434, PreRetirement Qualified Domestic Relations Order for Division of
Marital Property. If the participant is not receiving a retirement benefit,
then the alternate payee shall not receive a retirement
benefit.
Section 10. The
Form 6434, Pre-Retirement Qualified Domestic Relations Order for Division of
Marital Property, shall specify the amount to be paid to the alternate payee.
The court shall use one (1) of the following methods to calculate the amount to
be paid to the alternate payee:
(1) A monthly
dollar amount if the participant elects a monthly retirement benefit or a one
(1) time lump sum dollar amount if the participant selects the actuarial refund
payment option pursuant to
KRS
61.635(11) at the
participant's retirement, or a lump sum dollar amount from participant's refund
of contributions and interest if the participant elects to terminate his
membership pursuant to
KRS
61.625;
(2) A percentage equal to one-half of the
participant's basic monthly retirement benefit attributable to any service
credit earned or purchased during the marriage pursuant to
KRS
61.595 or
16.576,
actuarial refund pursuant to
KRS
61.635(11), or lump sum
payment pursuant to
KRS
61.625, which shall be determined as follows:
(a) The numerator of the fraction shall be
the number of months during which the participant was both a contributing
member of the retirement systems affected by the QDRO and married to the
alternate payee, including service purchased during the marriage. The
retirement systems shall utilize the marital period as provided by the court in
the QDRO;
(b) The denominator of
the fraction, which shall be determined by the retirement system as of the
participant's effective retirement date or the participant's termination date
prior to the participant's filing of a request for a refund of contributions
and interest, shall be the total number of months of service credit used to
calculate the participant's retirement payment options or the total number of
months of service credit the participant had at the time of the request for
refund of contributions and interest; and
(c) The resulting fraction shall be converted
to a percentage, which shall be divided by two (2) to determine the percentage
of the benefit due to the alternate payee; or
(3) An alternative percentage of the
participant's basic monthly retirement benefit pursuant to
KRS
61.595 or
16.576,
actuarial refund pursuant to
KRS
61.635(11), or lump-sum
payment pursuant
KRS
61.625, in the system or systems affected by
the QDRO.
Section 11.
(1) The provisions of this section shall only
apply to participants who were participating prior to August 1, 2004. If a
participant who was participating prior to August 1, 2004, and who has a QDRO
on file at the retirement systems is awarded disability retirement benefits
pursuant to
KRS 16.582,
61.600, or
61.621
the alternate payee's portion of the participant's disability retirement
benefit shall be calculated as follows:
(a)
If the QDRO ordered that the alternate payee be paid a specific dollar amount
from the participant's retirement benefit as provided in Section 10(1) of this
administrative regulation, the retirement system shall pay the specific dollar
amount regardless of any enhancement of the participant's retirement benefit;
or
(b) If the QDRO ordered that the
alternate payee be paid a percentage of the participant's retirement benefit as
provided in Section 10(2) and (3) of this administrative regulation, the
retirement systems shall not use the service credit added to the participant's
account pursuant to
KRS
16.582(5)(a) or
61.605(1)
when calculating the amount the alternate payee is due under the QDRO on file
at the retirement systems.
(2)
(a) If
the participant's disability retirement benefits are discontinued pursuant to
KRS
61.610 and
61.615
and the participant is not eligible to receive early retirement benefits, the
alternate payee's payment shall be discontinued.
(b) If the participant's disability
retirement benefits are discontinued pursuant to
KRS
61.610 and
61.615
and the participant's benefit is changed to the participant's early retirement
benefit, the alternate payee shall receive payment from the early retirement
benefit pursuant to the QDRO.
(c)
If the participant's disability retirement benefits are reinstated pursuant to
KRS
61.615, the alternate payee's payment shall
be reinstated.
(d) If the
participant later begins receiving early retirement benefits while his
disability retirement benefits are discontinued, the alternate payee shall
receive payment from the early retirement benefit pursuant to the
QDRO.
Section
12.
(1) The provisions of this
section shall only apply to participants whose participation began on or after
August 1, 2004. If a participant whose participation began on or after August
1, 2004, and who has a QDRO on file at the retirement systems is awarded
disability retirement benefits pursuant to
KRS 16.582,
61.600, or
61.621
the alternate payee's portion of the participant's disability retirement
benefit shall be calculated as follows:
(a) If
the QDRO ordered that the alternate payee be paid a specific dollar amount from
the participant's retirement benefit as provided in Section 10(1) of this
administrative regulation, the retirement system shall pay the specific dollar
amount regardless of any enhancement of the participant's retirement benefit;
or
(b) If the QDRO ordered that the
alternate payee be paid a percentage of the participant's retirement benefit as
provided in Section 10(2) and (3) of this administrative regulation, the
retirement systems shall use the participant's benefit pursuant to
KRS
16.582(5)(b) or
61.605(2)
when calculating the amount the alternate payee is due under the QDRO on file
at the retirement systems.
(2)
(a) If
the participant's disability retirement benefits are discontinued pursuant to
KRS
61.610 and
61.615
and the participant is not eligible to receive early retirement benefits, the
alternate payee's payment shall be discontinued.
(b) If the participant's disability
retirement benefits are discontinued pursuant to
KRS
61.610 and
61.615
and the participant's benefit is changed to the participant's early retirement
benefit, the alternate payee shall receive payment from the early retirement
benefit pursuant to the QDRO.
(c)
If the participant's disability retirement benefits are reinstated pursuant to
KRS
61.615, the alternate payee's payment shall
be reinstated.
(d) If the
participant later begins receiving early retirement benefits while his
disability retirement benefits are discontinued, the alternate payee shall
receive payment from the early retirement benefit pursuant to the
QDRO.
Section
13. A QDRO issued for purposes of division of the participant's
retirement account pursuant to a divorce decree entered after the participant's
effective retirement date, or initially submitted to the retirement system
following the participant's effective retirement date, shall be submitted on
the Form 6435, Post-Retirement Qualified Domestic Relations Order for Division
of Marital Property.
Section 14.
(1) The Form 6435, Post-Retirement Qualified
Domestic Relations Order for Division of Marital Property, shall specify the
amount to be paid to the alternate payee.
(2) The court shall use one (1) of the
following methods to calculate the amount to be paid to the alternate payee:
(a) As a monthly dollar amount;
(b) As a percentage of the participant's
selected monthly retirement benefit, which shall be determined as follows:
1. The numerator of the fraction shall be the
number of months during which the participant was both a contributing member of
the retirement systems affected by the QDRO and married to the alternate payee,
including service purchased during the marriage. The retirement systems shall
utilize the marital period as provided by the court in the QDRO;
2. The denominator of the fraction, shall be
the total number of months of service credit used to calculate the
participant's retirement payment option; and
3. The resulting fraction shall be converted
to a percentage, which shall be divided by two (2) to determine the percentage
of the benefit due to the alternate payee; or
(c) An alternative percentage of the
participant's selected monthly retirement benefit in the system or systems
affected by the QDRO.
Section 15.
(1) If the retirement systems determines that
the Form 6435, Post-Retirement Qualified Domestic Relations Order for Division
of Marital Property, does not comply with
KRS
61.690,
26 U.S.C.
414(p), or this
administrative regulation, the retirement systems shall:
(a) Segregate and hold the amount that would
have been payable to the alternate payee if the Form 6435, Post-Retirement
Qualified Domestic Relations Order for Division of Marital Property, had been
in compliance with
KRS
61.690,
26 U.S.C.
414(p), and this
administrative regulation;
(b) Hold
the segregated amount for a period of no more than the eighteen (18) month hold
period. The eighteen (18) month hold period begins on the date the first
payment would be required by the Form 6435, Post-Retirement Qualified Domestic
Relations Order for Division of Marital Property, that the retirement systems
determined was not in compliance with
KRS
61.690,
26 U.S.C.
414(p), and this
administrative regulation;
(c) If a
Form 6435, Post-Retirement Qualified Domestic Relations Order for Division of
Marital Property, is submitted and determined to be in compliance with
KRS
61.690,
26 U.S.C.
414(p), and this
administrative regulation within the eighteen (18) month hold period, pay the
segregated amount to the alternate payee;
(d) If no subsequent Form 6435,
Post-Retirement Qualified Domestic Relations Order for Division of Marital
Property, is submitted and determined to be in compliance with
KRS
61.690,
26 U.S.C.
414(p), and this
administrative regulation within the eighteen (18) month hold period, pay the
segregated amount to the participant; or
(e) If after the eighteen (18) month hold
period a subsequent Form 6435, Post-Retirement Qualified Domestic Relations
Order, is submitted and determined to be in compliance with
KRS
61.690,
26 U.S.C.
414(p), and this
administrative regulation, the Form 6435, Post-Retirement Qualified Domestic
Relations Order shall only be applied prospectively.
(2) The effective date of the first payment
to the alternate payee shall be the month following the month the Form 6435,
Post-Retirement Qualified Domestic Relations Order for Division of Marital
Property, is approved for enforcement by the retirement
systems.
Section 16.
(1) A QDRO issued for purposes of payment of
child support shall be submitted on the Form 6436, Qualified Domestic Relations
Order for Child Support, or the Form 6437, Qualified Domestic Relations Order
for Child Support by an Administrative Agency.
(2) The monthly dollar amount of child
support to be paid by the participant shall be determined by a court of
competent jurisdiction or an administrative agency with statutory authority to
issue an order for child support in accordance with the laws governing child
support.
(3) The retirement systems
shall remit the payment for child support to the centralized registry
established pursuant to
KRS
205.712 and defined in
921 KAR 1:001,
Section 1(5).
(a) The payment for child
support shall be made payable to "Kentucky Child Support
Enforcement".
(b) The participant's
name and Social Security number shall be noted on the payment.
(4) An alternate payee listed on
the Form 6436, Qualified Domestic Relations Order for Child Support, or the
Form 6437, Qualified Domestic Relations Order for Child Support by an
Administrative Agency shall not be required to submit a Form 6130,
Authorization for Deposit of Retirement Payment or a Form 6135, Payment of
Retirement Payment by Check.
(5)
The retirement systems shall not accept a Form 6436, Qualified Domestic
Relations Order for Child Support, or a Form 6437, Qualified Domestic Relations
Order for Child Support by an Administrative Agency, if the participant has not
retired and is not receiving a monthly retirement benefit.
Section 17.
(1) A QDRO issued for purposes of payment of
alimony or maintenance pursuant to
KRS
403.200 shall be submitted on the Form 6438,
Qualified Domestic Relations Order for Alimony/Maintenance.
(2) The amount of alimony or maintenance to
be paid by the participant shall be determined by a court of competent
jurisdiction in accordance with the laws governing alimony or
maintenance.
(3) The retirement
systems shall not accept a Form 6438, Qualified Domestic Relations Order for
Alimony/Maintenance if the participant has not retired and is not receiving a
monthly retirement benefit.
Section
18.
(1) The participant shall be
responsible for notifying the retirement systems in writing of an event that
causes payments to the alternate payee under a QDRO for Division of Marital
Property or a QDRO for Alimony/Maintenance to end.
(2) The retirement systems shall hold any
payments due the alternate payee pending submission of proof of the event that
causes payments to the alternate payee to end is provided by the participant
beginning the month after the retirement systems' receipt of the participant's
written notification.
(3) The
participant shall submit a copy of the alternate payee's marriage certificate,
the alternate payee's death certificate, or other reliable documentation as
proof of the event that causes the participant's alimony or maintenance to
end.
(4) The participant shall
submit a copy of the alternate payee's death certificate or other reliable
documentation as proof of the event that causes the participant's payments
pursuant to the division of marital property to end.
(5) The participant shall not be required to
submit written notification if the QDRO specifies the number of months of
payments.
(6) If proof is not
submitted within ninety (90) days of the written notification to the retirement
systems, the payments being held shall be released to the alternate
payee.
(7) The retirement systems
shall not be liable for any payments made to the alternate payee if the
participant failed to provide proper notification and documentation of the
event that causes payments to the alternate payee to end.
Section 19.
(1) The participant shall be responsible for
notifying the retirement systems in writing of an event that causes payments to
the alternate payee under a QDRO for Child Support to be amended or to
end.
(2)
(a) If an alternate payee is being paid child
support pursuant to a Form 6436, Qualified Domestic Relations Order for Child
Support, or the Form 6437, Qualified Domestic Relations Order for Child Support
by an Administrative Agency, the participant shall submit an entered and
certified order from a court of competent jurisdiction or an administrative
agency with statutory authority to order child support providing that payments
under the Form 6436, Qualified Domestic Relations Order for Child Support, or
the Form 6437, Qualified Domestic Relations Order for Child Support by an
Administrative Agency, shall end or be amended.
(b)
1. The
retirement systems shall segregate and hold the payments due to the alternate
payee under a Form 6436, Qualified Domestic Relations Order for Child Support,
or the Form 6437, Qualified Domestic Relations Order for Child Support by an
Administrative Agency, if the participant submits an order changing the custody
of the child to someone other than the alternate payee, a copy of the child's
marriage certificate, a letter from the child's high school indicating the
child's graduation date, the child's birth certificate, an order of
emancipation of the minor child, or the child's death certificate.
2. If the QDRO for child support is for the
support of more than one (1) child, the retirement systems shall not segregate
or hold payments due to the alternate payee.
(c) If the participant does not submit an
entered and certified order amending or terminating the QDRO for child support
from a court of competent jurisdiction or an administrative agency with
statutory authority to order child support within ninety (90) days of the
participant's submission as provided in paragraph (b) of this subsection, the
payments being held shall be released to the alternate payee.
(3) The retirement systems shall
not be liable for any payments made to the alternate payee if the participant
failed to provide proper notification, documentation of the event, or the court
order that causes payments to the alternate payee to end or be
amended.
Section 20.
(1) If there are multiple QDROs on file for a
participant's account, the QDROs shall be administered in the following order:
(a) QDROs for the Division of Marital
Property;
(b) QDROs for Child
Support;
(c) QDROs for
Alimony/Maintenance.
(2)
If multiple QDROs for the Division of Marital Property are on file, they shall
be administered in the order of approval by the retirement systems.
(3) If multiple QDROs for Child Support are
on file, they shall be administered in the order of approval by the retirement
systems.
(4) If multiple QDROs for
Alimony/Maintenance are on file, they shall be administered in the order of
approval by the retirement systems.
(5) If a QDRO for Child Support is submitted
subsequent to the participant's retirement and subsequent to the administration
of the QDROs on file at the time of the participant's retirement it shall be
given priority over any QDROs for Alimony/Maintenance being
administered.
(6)
(a) The retirement systems shall not
administer a QDRO if enforcement of the QDRO would result in the total amount
of payments due to the alternate payees to exceed the participant's monthly
retirement benefit under the multiple QDROs approved for enforcement by the
retirement systems. The retirement systems shall notify the participant and
alternate payees if a QDRO cannot be administered due to the exhaustion of the
participant's monthly retirement benefit.
(b) The retirement systems shall recalculate
the amounts due under the QDROs being administered by the retirement systems on
a participant's account after the effective date of any cost of living increase
provided pursuant to
KRS
61.691.
Section 21. The alternate payee shall be
responsible for notifying the retirement systems in writing of any change in
mailing address. The retirement systems shall contact the alternate payee at
the last known mailing address on file to notify the alternate payee when a
benefit subject to the QDRO becomes payable. The retirement systems shall not
have a duty or obligation to search for or locate an alternate payee.
Section 22. A QDRO shall not provide that the
alternate payee be eligible to enroll in the health insurance plan administered
by the retirement systems.
Section
23.
(1) If the participant's
retirement benefit is corrected pursuant to
KRS
61.685, the alternate payee's payment shall
also be corrected.
(2) If the
alternate payee was overpaid because of the error that is being corrected
pursuant to
KRS
61.685, the retirement systems shall withhold
the amount of the overpayment from the alternate payee's payment.
(3) If the alternate payee was underpaid
because of the error that is being corrected pursuant to
KRS
61.685, the retirement systems shall pay the
alternate payee a lump sum payment of the additional funds due from the
participant's payment.
Section
24.
(1) Any person or party who
attempts to make the retirement systems a party to a domestic relations action
regarding a QDRO or who requests a subpoena be issued for the personal
appearance of a representative of the retirement systems to appear at a
deposition or in a court or administrative proceeding regarding a QDRO shall
reimburse the retirement systems for the travel expenses and services of the
retirement systems' representative, or representatives, and the retirement
systems' legal counsel, as an administrative fee including:
(a) The Internal Revenue Service standard
mileage rate;
(b) Parking and
tolls;
(c) Meals if the retirement
systems' personnel are required to travel and be away from the retirement
office from 6:30 a.m. to 9 a.m., 11 a.m. to 2 p.m., or 5 p.m. to 9
p.m.;
(d) The wages earned by the
retirement systems' employees during the time period they are away from the
retirement office calculated by multiplying the hourly rate of each employee by
the number of hours each employee was away from the office;
(e) The retirement systems costs and legal
fees; and
(f) Lodging expenses, if
necessary.
(2) The
retirement systems shall send an estimated amount owed for expenses to the
person or party requesting the subpoena.
(a)
The person or party shall remit payment for the estimated expenses before the
date of appearance ordered in the subpoena.
(b) The retirement systems shall send an
invoice for any additional expenses owed by the party or issue a refund for any
amount over the cost of the expenses.
Section 25. Neither the retirement systems
nor its trustees nor its employees shall have any liability for making or
withholding payments in accordance with the provisions of this administrative
regulation.
Section 26.
Incorporation by Reference.
(1) The following
material is incorporated by reference:
(a)
Form 6015, "Estimate of a Monthly Retirement Allowance", July 2004;
(b) Form 6434, "Pre-Retirement Qualified
Domestic Relations Order for Division of Marital Property", May 2011;
(c) Form 6435, "Post-Retirement Qualified
Domestic Relations Order for Division of Marital Property", May 2011;
(d) Form 6436, "Qualified Domestic Relations
Order for Child Support", May 2011;
(e) Form 6437, "Qualified Domestic Relations
Order for Child Support by an Administrative Agency", May 2011;
(f) Form 6438, "Qualified Domestic Relations
Order for Alimony/Maintenance", May 2011;
(g) Form 6130, "Authorization for Deposit of
Retirement Payment", April 2010;
(h)
Form 6135, "Payment of Retirement Payment by Check", February 2002; and
(i) Form 6433, "Authorization for
Release of Information and Request for Information for Qualified Domestic
Relations Orders", August 2010.
(2) This material may be inspected, copied,
or obtained, subject to applicable copyright law, at the Kentucky Retirement
Systems, Perimeter Park West, 1260 Louisville Road, Frankfort, Kentucky 40601,
Monday through Friday, from 8 a.m. to 4:30 p.m.
STATUTORY AUTHORITY:
KRS
61.645(9)(e),
61.690