HLS 18RS-241 ENGROSSED
2018 Regular Session
HOUSE BILL NO. 9
BY REPRESENTATIVE IVEY
RETIREMENT/FIREFIGHTERS: Provides for definitions relative to rollovers of sums
between the Firefighters' Retirement System and other qualified plans under the
provisions of the Internal Revenue Code
1 AN ACT
2To amend and reenact R.S. 11:2254(D) and to enact R.S. 11:2254(E) and (F), relative to the
3 Firefighters' Retirement System; to provide relative to direct rollovers of sums from
4 the system to qualified plans; to provide for definitions; and to provide for related
5 matters.
6 Notice of intention to introduce this Act has been published
7 as provided by Article X, Section 29(C) of the Constitution
8 of Louisiana.
9Be it enacted by the Legislature of Louisiana:
10 Section 1. R.S. 11:2254(D) is hereby amended and reenacted and R.S. 11:2254(E)
11and (F) are hereby enacted to read as follows:
12 ยง2254. Creditable service
13 * * *
14 D.(1) The system shall permit direct rollovers from other qualified
15 retirement plans. "Direct rollovers" for purposes of this Section shall mean trustee
16 to trustee transfers of sums from other qualified plans which are permitted to roll
17 over sums to other qualified plans under the provisions of the Internal Revenue Code
18 of 1986, as amended. Amounts so rolled over may be used to purchase service
19 credits at the accrual rate established by the system actuary using actuarial
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1 assumptions consistently applied, subject to the limitations of Section 415(n) of the
2 Internal Revenue Code of 1986, as amended. Any such service credit may only be
3 purchased if authorized by statutory authority, other than this Subsection,
4 specifically identifying the type of credit authorized to be purchased. Amounts may
5 not be rolled over which are in excess of the amounts which may be used to purchase
6 creditable service under Section 415(n). No member shall receive a benefit for
7 purchased creditable service if to do so would cause the member to receive a
8 retirement benefit for the same service under more than one retirement plan.
9 E.(1) Notwithstanding any other provision of law to the contrary that would
10 otherwise limit a distributee's election under this Subsection, a distributee may elect,
11 at the time and in the manner prescribed by the plan administrator, to have any
12 portion of an eligible rollover distribution paid directly to an eligible retirement plan
13 specified by the distributee in a direct rollover.
14 (2) If a mandatory distribution greater than one thousand dollars is made on
15 or after March 28, 2005, and the distributee does not elect to have such distribution
16 paid directly to an eligible retirement plan specified by the distributee in a direct
17 rollover or to receive the distribution directly, then the plan administrator shall pay
18 the distribution in a direct rollover to an individual retirement plan designated by the
19 plan administrator. For purposes of determining whether a mandatory distribution
20 is greater than one thousand dollars, the portion of the distributee's distribution
21 attributable to any rollover contribution is included.
22 F. For purposes of this Section, the following words and phrases shall have
23 the following meanings:
24 (1) "Direct rollovers" shall mean trustee to trustee transfers of sums from
25 other qualified plans which are permitted to roll over sums to other qualified plans
26 under the provisions of the Internal Revenue Code of 1986, as amended.
27 (2)(a) "Eligible rollover distribution" shall mean any distribution of all or
28 any portion of the balance to the credit of the distributee. An eligible rollover
29 distribution shall not include:
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1 (i) Any distribution that is one of a series of substantially equal periodic
2 payments, not less frequently than annually, made for the life or life expectancy of
3 the distributee, or the joint lives or joint life expectancies of the distributee and the
4 distributee's designated beneficiary, or for a specified period of ten years or more.
5 (ii) Any distribution to the extent such distribution is required under Section
6 401(a)(9) of the Internal Revenue Code.
7 (iii) The portion of any distribution that is not includible in gross income,
8 determined without regard to the exclusion for net unrealized appreciation with
9 respect to employer securities.
10 (iv) Any other distribution that is reasonably expected to total less than two
11 hundred dollars during a year.
12 (b) A portion of the distribution shall not fail to be an eligible rollover
13 distribution merely because the portion consists of after-tax employee contributions
14 which are not includible in gross income. Such portion may be transferred only to
15 one of the following:
16 (i) A traditional individual retirement account or annuity described in
17 Section 408(a) or (b) of the Internal Revenue Code or a Roth IRA or annuity
18 described in Section 408A of the Internal Revenue Code.
19 (ii) A qualified defined contribution, defined benefit, or annuity plan
20 described in Section 401(a) or 403(b) of the Internal Revenue Code, or to an annuity
21 contract described in Section 403(b) of the Internal Revenue Code, if such plan or
22 contract provides for separate accounting for amounts so transferred, including
23 interest thereon, including separately accounting for the portion of such distribution
24 which is includible in gross income and the portion of such distribution which is not
25 so includible.
26 (3) "Eligible retirement plan" shall mean:
27 (a) An eligible plan described in Section 457(b) of the Internal Revenue
28 Code which is maintained by a state, political subdivision of a state, or any agency
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HB NO. 9
1 or instrumentality of a state or political subdivision of a state and which agrees to
2 separately account for amounts transferred into such plan from this system.
3 (b) A traditional individual retirement account.
4 (c) An annuity plan described in Section 403(b) of the Internal Revenue
5 Code.
6 (d) A qualified defined benefit or defined contribution plan described in
7 Section 401(a) of the Internal Revenue Code that accepts the distributee's eligible
8 rollover distribution.
9 (e) A distribution to a surviving spouse or to a spouse or former spouse who
10 is the alternative payee under a qualified domestic relations order as defined in
11 Section 414(p) of the Internal Revenue Code.
12 (4)(a) "Distributee" shall mean:
13 (i) A member or former member.
14 (ii) A member's or former member's surviving spouse, or a member's or
15 former member's spouse or former spouse who is the alternate payee under a
16 qualified domestic relations order as defined in Section 414(p) of the Internal
17 Revenue Code are distributees with regard to the interest of the spouse or former
18 spouse.
19 (iii) For distributions occurring in plan years beginning after December 31,
20 2009, the member's or former member's nonspouse designated beneficiary if the
21 direct rollover is made only to a traditional individual retirement account or a Roth
22 IRA that is established on behalf of the designated beneficiary and is treated as an
23 inherited individual retirement account pursuant to the provisions of Section
24 402(c)(11) of the Internal Revenue Code. In this case, the determination of any
25 required minimum distribution under Section 401(a)(9) of the Internal Revenue Code
26 that is ineligible for rollover shall be made in accordance with Notice 2007-7, Q&A
27 17 and 18, 2007-5 Internal Revenue Bulletin 395.
28 * * *
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HB NO. 9
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
HB 9 Engrossed 2018 Regular Session Ivey
Abstract: Provides for definitions consistent with provisions of the Internal Revenue Code
relative to direct rollovers of sums from qualified plans to the Firefighters'
Retirement System (the system) and from the system to other qualified plans.
Present law authorizes the system to permit direct rollovers of sums from other qualified
plans as provided by the Internal Revenue Code.
Proposed law retains present law and authorizes a recipient of funds from the system to
directly rollover such funds into another retirement plan. Defines applicable terms in
conformity with the provisions of federal law relative to tax-qualified defined benefit plans.
(Amends R.S. 11:2254(D); Adds R.S. 11:2254(E) and (F))
Summary of Amendments Adopted by House
The Committee Amendments Proposed by House Committee on Retirement to the
original bill:
1. Make technical changes.
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