Questions about account valuations and distributions- SPU 401(a) Pension Plan

When will my retirement benefits be paid?

Accounts Valued at $1,000 or Less: If the value of your vested Account balances is $1,000 or less, payment will be made to you in a lump sum (or as a direct rollover) as soon as administratively practicable following your termination of employment with the University.

Accounts Valued at More Than $1,000: If the value of your vested Account balances exceeds $1,000, payment will be made as of the following applicable date:

  • as soon as reasonably practicable after the later of (a) your termination of employment with the University and (b) the date on which the Plan Administrator receives your properly completed distribution election form;
  • if an earlier election for payment of benefits has not been made as provided above, within 60 days after the end of the Plan Year in which you (a) attain Normal Retirement Age, (b) reach the 10th anniversary of the date on which you first became a participant in the Plan, or (c) terminate from employment with the University, whichever occurs last, unless you elect in writing to defer payment beyond that date; and
  • in any event, not later than the first April 1 following the later of (a) the calendar year in which you attain age 70 or (b) the calendar year in which your employment with the University terminates.

Age 70 distributions. If you are 70 or older and still employed by the University, you may elect to begin payment of your benefits at any time in any form permitted by the Plan.

When are my accounts valued?

Your Accounts are adjusted each business day that the New York Stock Exchange is open to reflect any distributions made, any contributions received and such Accounts' share of the earnings of the investment funds in which such Accounts are invested.

How are distributions taxed?

All amounts distributed from the Plan are subject to ordinary federal income tax (and state tax, if applicable) in the calendar year in which you receive the distribution, unless the distribution is eligible for rollover and you timely roll over the distribution to an IRA or another Eligible Employer Plan. Any portion of your distribution that qualifies as an Eligible Rollover Distribution and that is not directly rolled into an IRA or another Eligible Employer Plan must have 20% of the taxable portion of the distribution withheld for federal income tax. However, if the amount of your Eligible Rollover Distribution payable in one tax year is less than $200, federal income tax withholding is not required.

An additional tax equal to 10% of the amount distributed must also be paid if the distribution is made before you:

  • attain age 59,
  • die, or
  • become disabled,

and the amount distributed to you is not:

  • rolled over into an IRA or another Eligible Employer Plan ,
  • used to pay deductible medical expenses,
  • made to you after your separation from service after you attain age 55, or
  • made pursuant to a qualified domestic relations order. (See Section 11.2 for more explanation.)