Current through February 26, 2024
(1) Purpose. The
purpose of this section is to interpret s.
40.04(7),
Stats. This section establishes the procedures for electing to participate,
participating and electing to terminate participation in the variable division
of the trust fund.
(1m)
Definitions. In this section, "new participant" means any of the following:
(a) A person initially qualifying as a
participant as defined by s.
40.02(45),
Stats., who has never previously been a participant in the Wisconsin retirement
system or Wisconsin retirement fund or a member of the state teachers
retirement system or Milwaukee teacher retirement fund.
(b) A person who was previously a participant
but whose Wisconsin retirement system account was closed because of payment of
a lump sum benefit under s.
40.25, Stats.,
and who returns to covered employment for the first time since the account
closure. The term "new participant" does not include a person whose closed
account is reestablished under s.
40.25(5),
Stats.
(2) Eligibility
for and effective dates of participation in the variable division.
(a) An election to participate, or terminate
participation, in the variable division shall be made on a form provided by the
department. Except as provided in sub. (3), an election to participate in the
variable division shall become effective for future contributions on the
January 1 following receipt of the form by the department.
(b) Participants who elected to terminate
participation in the variable division effective before December 31, 1999 may
elect to participate in the variable division as provided in this
section.
(c) Except as provided in
par. (d), pursuant to s.
40.04(7)
(b), Stats., participants who elected to
terminate participation in the variable division effective on or after December
31, 1999 may not re-elect to participate in the variable division.
(d) A participant who elects to terminate
participation in the variable division effective on or after December 31, 1999
may re-elect to participate in the variable division only if the participant
ceases to be a participant by closing the participant's account through taking
a benefit under s.
40.25, Stats.,
and subsequently becoming a new participating employee.
(e) An election to participate in the
variable division received by the department from a participant who is not a
participating employee, and who ceased to be a participating employee before
January 1, 2001, shall become effective on the January 1 on or after the date
on which the participant again becomes a participating employee.
(f) An election to participate in the
variable division received by the department after the participant's date of
death is invalid.
Note: The form for electing to participate in the variable
division, "Election to Participate in the Variable Trust Fund," ET-2356, can be
obtained at no charge by writing to: department of employee trust funds, P.O.
Box 7931, Madison, WI 53707-7931, or by calling: (608) 266-3285 or toll free at
(877) 533-5020. The form is also available on the department's website:
etf.wi.gov.
(3)
Variable division participation for new participants.
(a) An election to participate in the
variable division filed by a person who becomes a new participant on or after
January 1, 2001 shall become effective as follows:
1. Retroactive to the date on which the
person becomes a participant, providing that the department receives the form
no later than 30 calendar days after the date on which the person became a
participant.
2. Elections to
participate in the variable division that are received by the department more
than 30 calendar days after the date on which the person becomes a participant
shall become effective on the January 1 following receipt of the form by the
department.
(b) The
department shall accept elections to participate in the variable division up to
90 calendar days before the date on which a participant becomes a participating
employee. Elections received by the department within this 90-day period or
within the next 30 days after the person becomes a participating employee shall
become effective on the date on which the person becomes a participating
employee. Elections to participate in the variable division received by the
department more than 90 calendar days before the date on which a person becomes
a participant are invalid.
(4) Retroactive contributions.
(a) Retroactive interest credited to
contributions for late-paid earnings shall be credited at the core effective
rates as provided in s.
40.06(5),
Stats.
(b) Late-paid and other
retroactive contributions shall be deposited in the core and variable trust
accounts according to the participant's variable participation status at the
time the contributions are deposited, regardless of the participant's variable
participation status in the annual earnings period to which the contributions
may be attributed for other purposes.
(5) Terminating participation in the variable
division.
(a) A participant may elect to
terminate participation in the variable division and transfer the participant's
variable division contributions to the core division on one of the following
bases:
1. For future contributions only:
Effective as of the December 31 after the date on which the department receives
an election to terminate participation in the variable division, all future
contributions shall be deposited in the core division.
2. An unconditional basis: Effective as of
the December 31 after the date on which the department receives an election to
terminate participation in the variable division, all future contributions
shall be deposited in the core division and all variable contributions and
accrued gain or loss shall be transferred to the core division.
3. A conditional basis:
a. For annuities, effective on the first
January 1 after the department receives the election when the condition under
s.
40.04(7)
(a) 1, Stats., is satisfied.
b. For all accounts from which an annuity is
not being paid, effective on the first January 1 after the department receives
the election when the condition under s.
40.04(7)
(a) 2, Stats., is satisfied. As of the first
January 1 after the Department receives the election, all future contributions
shall be deposited in the core division. As of the first January 1 when the
condition under s.
40.04(7)
(a) 2, Stats., is satisfied, all variable
contributions and accrued gain or loss shall be transferred to the core
division.
Example 1: A participant, alternate payee, named survivor or
beneficiary who is receiving an annuity from the Wisconsin retirement system,
and who also has an account from voluntary additional contributions from which
no annuity is being paid, is not an annuitant under s.
40.04(7)
(a)with respect to the additional
contributions.
Example 2: An alternate payee who was also a participating
employee in the Wisconsin retirement system and who is receiving an annuity
only from the alternate payee account is not an annuitant with respect to the
separate account established as a participating employee.
Note: The form for electing to terminate participation in the
variable division, "Election to Cancel Variable Participation," ET-2313, can be
obtained at no charge by writing to: department of employee trust funds, P.O.
Box 7931, Madison, WI 53707-7931 or by calling: (608) 266-3285 or toll free at
(877) 533-5020. The form also is available on the department's website:
etf.wi.gov.
(b) Except as provided in par. (c), an
election to terminate participation in the variable division may be rescinded
if the department receives a written request to rescind the election from an
alternate payee, beneficiary, named survivor, or participant as defined in s.
40.02(2m), (8), (41r) and
(45), Stats., before the December 31
following the date on which the election to terminate participation in the
variable division was received.
Note: No specific form exists for rescinding an election to
terminate participation in the variable division. The written request must be
dated and must make clear your intent and by including words to the effect of
"I want to rescind my election to terminate participation in the variable
division." Participants may send a letter or fax with this request to the
following address: department of employee trust funds, P.O. Box 7931, Madison,
WI 53707-7931 or fax (608) 267-4549.
(c) An election to terminate participation in
the variable division received within 30 days after the date on which the
person became a participant may be rescinded if the department receives the
participant's written request to rescind the election no later than 30 days
after the date on which the person became a new variable division participant
as provided in sub. (3).
(d) A
rescinded election to terminate participation in the variable division shall be
treated as if the election never existed.
(e) When the department receives an election
to terminate participation in the variable division more than 30 calendar days
after the date on which a person became a new variable division participant as
defined in sub. (3), the participant shall not be eligible to re-elect to
participate in the variable division without meeting the requirements of sub.
(2) (d).
(f) For an account or
annuity that includes additional contribution, when an election to terminate
participation in the variable division pursuant to s.
40.04(7) (a)
1 or 2., Stats., is made by an alternate
payee, beneficiary, named survivor, or participant as defined in s.
40.02(2m), (8), (41r) and
(45), Stats., the determination of whether
the variable contributions and accrued gain or loss shall be transferred to the
core division shall be based on an evaluation of the combined total of the
required and additional contributions and shall be effective as prescribed in
this section.
(g) An election to
terminate participation in the variable division filed pursuant to s.
40.04(7),
Stats., shall be effective for all retirement contributions and benefits
accrued as a participant except that for an annuitant who has variable
accumulations from which no annuity is being paid, the effective date of an
election shall be separately determined for the current annuity or annuities
and for the variable division accumulations from which no annuity is being
paid.
(h) When multiple elections
to terminate participation in the variable division for an account are received
by the department, the last election received by the department shall supersede
previous elections and shall be applied to the account if it is received before
the December 31 on which the previous election to terminate variable division
participation would become effective.
(i) Any gains or losses at the effective date
of a transfer pursuant to s.
40.04(7),
Stats., including subsequent interest credits, shall be reflected as an
adjustment to the benefit at the time it is payable.
(j) Participants may rescind elections to
participate in the variable division under the following conditions:
1. If an election to participate in the
variable division would become effective on a January 1 after it is received,
as provided in sub. (2), the election shall be rescinded if the department
receives an election to terminate participation in the variable division before
the date on which the election would otherwise become effective.
2. If an election to participate in the
variable division would become effective on the date on which the participant
became a participating employee as provided in sub. (3), the election to
participate shall be rescinded if the department receives an election to
terminate participation in the variable division within 30 calendar days after
the date on which the participant becomes a participating employee.
(k) An election to terminate
participation in the variable division received by the department after the
date of death of the person making the election is invalid.
(L) A person may be a participant, alternate
payee, named survivor, beneficiary or combination thereof under the Wisconsin
retirement system, and may have different accounts or annuities in each
capacity. Except as otherwise provided in this paragraph, an election to
terminate participation in the variable division applies to all of a person's
accounts and annuities. A person may specify that an election to terminate
participation in the variable division applies only to one or more of the
following:
1. All accounts and annuities held
in the capacity of a participant.
2. All accounts and annuities held in the
capacity of an alternate payee of a specified participant.
3. All accounts and annuities held in the
capacity of a named survivor of a specified participant.
4. All accounts and annuities held in the
capacity of a beneficiary of a specified participant.
(m) The December 31 effective date for an
election to terminate participation in the variable division means on December
31 after interest crediting under s.
40.04(4)
(a), Stats., has occurred.
(6) Rights of beneficiaries,
alternate payees, and named survivors.
(a) An
election to participate in the variable division received by the department
from an alternate payee, beneficiary, or named survivor as defined in s.
40.02(2m), (8), and
(41r), Stats., is invalid.
(b) A person receiving or eligible to receive
benefits as the alternate payee, sole beneficiary, or named survivor of a
participant as defined in s.
40.02(2m), (8), and
(41r), Stats., may elect to terminate
participation in the variable division pursuant to s.
40.04(7),
Stats.
(c) Except as provided in
pars. (d) and (e), terminating participation or rescinding an election to
participate in the variable division shall be determined pursuant to sub.
(5).
(d) If there is more than one
beneficiary of an account from which no annuity is being paid, the multiple
beneficiaries may jointly elect to terminate participation in the variable
division pursuant to s.
40.04(7),
Stats. Participation in the variable division will be terminated effective on
the December 31 following receipt of an election to terminate participation in
the variable division from each of the multiple beneficiaries. Any one of the
multiple beneficiaries may rescind his or her election to terminate
participation in the variable division prior to the date it would otherwise
have gone into effect, in which case the rescinded election to terminate
participation in the variable division shall be treated as if the election
never existed.
(e) If there is more
than one beneficiary of an account from which no annuity is being paid, and the
beneficiaries do not all elect to terminate participation in the variable
division pursuant to s.
40.04(7),
Stats., as provided in par. (d), an individual beneficiary's election to
terminate participation in the variable division received by the department
shall become effective on the December 31 on or after the effective date of the
beneficiary's annuity from that beneficiary's portion of the participant's
account, unless previously withdrawn.
(f) A participant's election to terminate
participation in the variable division received by the department before the
participant's date of death shall become effective as provided in sub. (2), and
shall apply to any accounts or annuities that are payable to the participant's
beneficiaries unless the election is rescinded as provided in sub.
(5).
(7) Incomplete
elections.
(a) An election to participate in
the variable division or an election to terminate participation in the variable
division that does not contain the name, social security number and signature
of the person making the election shall be deemed incomplete.
(b) An election to terminate participation in
the variable division received by the department from a beneficiary or named
survivor as defined in s.
40.02(8) and
(41r), Stats., that does not include the
participant's name and social security number in addition to the name, social
security number and signature of the person making the election shall be deemed
incomplete. For terminations, the election must include a cancellation type as
specified in sub. (5) (a).
(c) When
the department receives an incomplete election, the election shall be returned
by mail to the elector for completion. If a correctly completed election is
received by the department within a grace period of 30 calendar days after the
incomplete election was returned by mail to the elector, the original receipt
date of the election shall be preserved for the purpose of determining the
effective date of the election. The effective date for corrected elections that
are not returned during the 30-day grace period shall be determined without
regard to the original submission and based on the date a correctly completed
election is received by the department.
(8) Electronic receipt.
(a) Subject to s.
ETF
10.82(2), the department may accept
correctly completed elections to participate in the variable division,
elections to terminate participation in the variable division and notifications
to rescind elections to terminate participation in the variable division that
are received by the department's facsimile machine or by electronic mail in a
complete and legible form. The facsimile or electronic mail may be accepted as
the original.
(b) The deadline for
submitting an election to terminate participation in the variable division that
is effective December 31 is December 31 of that year.
(c) The deadline for submitting an election
to participate in the variable division that is effective January 1 is December
31 of the prior year.
(d) For the
purposes of determining deadlines under this section, see s.
990.001(4),
Stats.
Under s.
230.35(4)
(a), Stats., December 31 and January 1 are
always legal holidays on which state offices are closed, as is the day
following January 1 when January 1 falls on a Sunday. The department does not
have duly established office hours on Saturday. Therefore, under s.
990.001(4)
(b), Stats., a December 31 deadline would be
extended until the next date which is not a holiday, Saturday or Sunday. For
example, the deadline of December 31, 2002, will be extended to Thursday,
January 2, 2003. The deadline of December 31, 2004, will be extended to Monday,
January 3, 2005. The deadline of December 31, 2005, will be extended to
Tuesday, January 3, 2006.