86.252. Distribution of interest of member, when--distribution periods before January 1, 2003--distributions on and after January 1, 2003.

MISSOURI STATUTES AND CODES

86.252. Distribution of interest of member, when--distribution periods before January 1, 2003--distributions on and after January 1, 2003.

Distribution of interest of member, when--distribution periods beforeJanuary 1, 2003--distributions on and after January 1, 2003.

86.252. 1. Notwithstanding any provision of sections 86.200 to86.366 to the contrary, the entire interest of a member shall bedistributed or begin to be distributed no later than the member's requiredbeginning date. The general required beginning date of a member's benefitis April first of the calendar year following the calendar year in whichthe member attains age seventy and one-half years or, if later, in whichthe member terminates employment as a police officer and actually retires.

2. All distributions required pursuant to this section prior toJanuary 1, 2003, shall be determined and made in accordance with the incometax regulations under Section 401(a)(9) of the Internal Revenue Code ineffect prior to January 1, 2003, including the minimum distributionincidental benefit requirement of Section 1.401(a)(9)-2 of the income taxregulations. As of the first distribution year, distributions, if not madein a single sum, may only be made over one of the following periods, or acombination thereof:

(1) The life of the member;

(2) The life of the member and a designated beneficiary;

(3) A period certain not extending beyond the life expectancy of themember; or

(4) A period certain not extending beyond the joint and last survivorexpectancy of the member and a designated beneficiary.

3. (1) This subsection shall apply for purposes of determiningrequired minimum distributions for calendar years beginning on and afterJanuary 1, 2003, and shall take precedence over any inconsistent provisionsof section 86.200 to 86.366. All distributions required under thissubsection shall be determined and made in accordance with the UnitedStates Treasury regulations under Section 401(a)(9) of the Internal RevenueCode of 1986, as amended.

(2) (a) The member's entire interest shall be distributed or beginto be distributed to the member no later than the member's requiredbeginning date.

(b) If the member dies before distributions begin, the member'sentire interest shall be distributed or begin to be distributed no laterthan as follows:

a. If the member's surviving spouse is the member's sole designatedbeneficiary, distributions to the surviving spouse shall begin by Decemberthirty-first of the calendar year immediately following the calendar yearin which the member died, or by December thirty-first of the calendar yearin which the member would have attained age seventy and one-half years, iflater;

b. If the member's surviving spouse is not the member's soledesignated beneficiary, distributions to the designated beneficiary shallbegin by December thirty-first of the calendar year immediately followingthe calendar year in which the member died;

c. If there is no designated beneficiary as of September thirtieth ofthe calendar year following the calendar year of the member's death, themember's entire interest shall be distributed by December thirty-first ofthe calendar year containing the fifth anniversary of the member's death;

d. If the member's surviving spouse is the member's sole designatedbeneficiary and the surviving spouse dies after the member but beforedistribution to the surviving spouse begins, this paragraph, except forsubparagraph a. of this paragraph, shall apply as if the surviving spousewere the member.

For purposes of this paragraph and subdivision (5) of this subsection,distributions shall be considered to begin on the member's requiredbeginning date, or if subparagraph d. of this paragraph applies, the datedistributions are required to begin to the surviving spouse undersubparagraph a. of this paragraph. If annuity payments irrevocablycommence to the member before the member's required beginning date, or tothe member's surviving spouse before the date of distributions are requiredto begin to the surviving spouse under subparagraph a. of this paragraph,the date of distributions shall be considered to begin the datedistributions actually commence.

(c) Unless the member's interest is distributed in the form of anannuity purchased from an insurance company or in a single sum on or beforethe required beginning date, as of the first distribution calendar yeardistributions shall be made in accordance with subdivisions (3), (4), and(5) of this subsection. If the member's interest is distributed in theform of an annuity purchased from an insurance company, distributions shallbe made in accordance with the requirements of Section 401(a)(9) of theInternal Revenue Code of 1986, as amended, and the United States Treasuryregulations.

(3) (a) If the member's interest is paid in the form of annuitydistributions under sections 86.200 to 86.366, payments under the annuityshall satisfy the following requirements:

a. The annuity distributions shall be paid in periodic payments madeat intervals not longer than one year;

b. The distribution period shall be over a life or lives, or over aperiod certain not longer than the period described in subdivision (4) or(5) of this subsection;

c. Once payments have begun over a period certain, the periodcertain shall not be changed even if the period certain is shorter than themaximum permitted;

d. Payments shall either be nonincreasing or increase only asfollows:

(i) By an annual percentage increase that does not exceed the annualpercentage increase in a cost-of-living index that is based on prices ofall items and issued by the federal Bureau of Labor Statistics;

(ii) To the extent of the reduction in the amount of the member'spayments to provide for a surviving benefit upon death, but only if thebeneficiary whose life was being used to determine the distribution perioddescribed in subdivision (4) of this subsection dies or is no longer themember's beneficiary under a qualified domestic relations order with themeaning of Section 414(p) of the Internal Revenue Code of 1986, as amended;

(iii) To provide cash refunds of employee contributions upon themember's death; or

(iv) To pay increased benefits that result from a revision ofsections 86.200 to 86.366.

(b) The amount distributed on or before the member's requiredbeginning date, or if the member dies before distribution begins, the datedistributions are required to begin under subparagraph a. or b. ofparagraph (b) of subdivision (2) of this subsection, shall be the paymentthat is required for one payment interval. The second payment need not bemade until the end of the next payment interval even if the paymentinterval ends in the next calendar year. "Payment intervals" means theperiods for which payments are received, such as bimonthly, monthly,semiannually, or annually. All of the member's benefit accruals as of thelast day of the first distribution calendar year shall be included in thecalculation of the amount of the annuity payments for payment intervalsending on or after the member's required beginning date.

(c) Any additional benefits accruing to the member in a calendar yearafter the first distribution calendar year shall be distributed beginningwith the first payment interval ending in the calendar year immediatelyfollowing the calendar year in which such amount accrues.

(4) (a) If the member's interest is being distributed in the form ofa joint and survivor annuity for the joint lives of the member and anonspouse beneficiary, annuity payments to be made on or after the member'srequired beginning date to the designated beneficiary after the member'sdeath shall not at any time exceed the applicable percentage of the annuitypayment for such period that would have been payable to the member usingthe table set forth in Q&A-2 of Section 1.401(a)(9)-6T of the United StatesTreasury regulations.

(b) The period certain for an annuity distribution commencing duringthe member's lifetime shall not exceed the applicable distribution periodfor the member under the Uniform Lifetime Table set forth in Section1.401(a)(9)-9 of the United States Treasury regulations for the calendaryear that contains the annuity starting date. If the annuity starting dateprecedes the year in which the member reaches age seventy, the applicabledistribution period for the member shall be the distribution period for ageseventy under the Uniform Lifetime Table set forth in Section 1.401(a)(9)-9of the United States Treasury regulations plus the excess of seventy overthe age of the member as of the member's birthday in the year thatcontained the annuity starting date.

(5) (a) If the member dies before the date distribution of his orher interest begins and there is a designated beneficiary, the member'sentire interest shall be distributed, beginning no later than the timedescribed in subparagraph a. or b. of paragraph (b) of subdivision (2) ofthis subsection, over the life of the designated beneficiary or over aperiod certain not exceeding:

a. Unless the annuity starting date is before the first distributioncalendar year, the life expectancy of the designated beneficiary determinedusing the beneficiary's age as of the beneficiary's birthday in thecalendar year immediately following the calendar year of the member'sdeath; or

b. If the annuity starting date is before the first distributioncalendar year, the life expectancy of the designated beneficiary determinedusing the beneficiary's age as of the beneficiary's birthday in thecalendar year that contains the annuity starting date.

(b) If the member dies before the date distributions begin and thereis no designated beneficiary as of September thirtieth of the calendar yearfollowing the calendar year of the member's death, distribution of themember's entire interest shall be completed by December thirty-first of thecalendar year containing the fifth anniversary of the member's death.

(c) If the member dies before the date distribution of his or herinterest begins, the member's surviving spouse is the member's soledesignated beneficiary, and the surviving spouse dies before distributionsto the surviving spouse begin, this subdivision shall apply as if thesurviving spouse were the member; except that, the time by whichdistributions shall begin shall be determined without regard tosubparagraph a. of paragraph (b) of subdivision (2) of this subsection.

(6) As used in this subsection, the following terms mean:

(a) "Designated beneficiary", the surviving spouse or the individualwho is designated as the beneficiary under subdivision (4) of section86.200 or any individual who is entitled to receive death benefits undersection 86.283 or 86.287 and is the designated beneficiary under Section401(a)(9) of the Internal Revenue Code of 1986, as amended, and Section1.401(a)(9)-1, Q&A-4 of the United States Treasury regulations;

(b) "Distribution calendar year", a calendar year for which a minimumdistribution is required. For distributions beginning before the member'sdeath, the first distribution calendar year is the calendar yearimmediately preceding the calendar year which contains the member'srequired beginning date. For distributions beginning after the member'sdeath, the first distribution calendar year is the calendar year in whichdistributions are required to begin under paragraph (b) of subdivision (2)of this subsection;

(c) "Life expectancy", life expectancy as computed by use of theSingle Life Table in Section 1.401(a)(9)-9 of the United States Treasuryregulations;

(d) "Required beginning date", April first of the calendar yearfollowing the calendar year in which the member attains age seventy andone-half years or, if later, in which the member terminates employment as apolice officer and actually retires.

(7) Notwithstanding any provision in this subsection to the contrary:

(a) A distribution for calendar years 2003, 2004, and 2005 shall notfail to satisfy Section 401(a)(9) of the Internal Revenue Code of 1986, asamended, merely because the payments do not satisfy Section 1.401(a)(9)-1,Q&A-1 to Q&A-16 of the United States Treasury regulations, provided thepayments satisfy Section 401(a)(9) of the Internal Revenue Code of 1986, asamended; and

(b) In the case of an annuity distribution option provided under theterms of sections 86.200 to 86.366 shall not fail to satisfy Section401(a)(9) of the Internal Revenue Code of 1986, as amended, merely becausethe annuity payments do not satisfy the requirements of Section1.401(a)(9)-1, Q&A-1 to Q&A-15 of the United States Treasury regulations,provided the distribution option satisfies Section 401(a)(9) of theInternal Revenue Code of 1986, as amended, based on a reasonable and goodfaith interpretation of the provisions of Section 401(a)(9) of the InternalRevenue Code of 1986, as amended.