 |
ARIZONA STATE SENATE
Fifty-Fourth Legislature, Second Regular Session
ASRS; required distributions
Purpose
Outlines determinations of retirement benefits for certain Arizona State Retirement System (ASRS) members.
Background
Current statute requires an ASRS member's (member) interest to be distributed, or begin to be distributed, to the member by the date that payment of a member's benefits must commence. The required beginning date cannot be later than the April 1 following the calendar year in which the member attains 70.5 years of age or in which the member terminates employment, whichever is later (A.R.S. § 38-775).
On the death of a retired member who is receiving benefits, the estate or beneficiary of the member is entitled to receive at least the amount of the member's contribution to ASRS plus interest, less the benefits received by the member. The estate or beneficiary may elect to receive the amount either as a lump sum or at the same periodic rate in effect at the time of the member's death (A.R.S. § 38-763).
By signing and submitting an acknowledgement in a manner established by ASRS a member's current spouse may consent to or waive specified beneficiary requirements (A.R.S. § 38‑776).
There is no anticipated fiscal impact to the state General Fund associated with this legislation.
Provisions
1. Directs ASRS, if a member dies after the member's required beginning date and the member had not commenced distribution of retirement benefits, to treat the member as having commenced distribution of retirement benefits on the member's required beginning date.
2. Directs ASRS to determine the member's retirement benefit as a straight annuity as of the date of the member's required beginning date, regardless of the consent or waiver of a member's current spouse.
3. Entitles the member's estate to the member's benefit payments and requires any remaining member contributions on account to be disbursed in the same manner as contributions of a member whose distribution of retirement benefits had commenced prior to their death.
4. Makes technical and conforming changes.
5. Becomes effective on the general effective date.
Prepared by Senate Research
January 13, 2020
MG/gs