Individual Account Retirement Plan – FAQs
What is an Individual Account Retirement Plan?
The Individual Account Retirement Plan is a defined contribution plan designed to provide eligible participants with a retirement benefit in addition to their Pension Plan benefit. With this type of plan, your employer contributes a specific amount to the plan on your behalf.
l spouse, unmarried dependent children, or your qualifying Domestic Partner under the terms of the plan of benefits of the Fund.
How Does the Plan Work?
When you become a Participant, an Individual Account is set up in your name. The amount that your employer contributes on your behalf to the Retirement Program determines whether a contribution will be made to your Individual Account and, if so, the amount of the contribution.
When Am I Vested?
Any Participant who has at least five (5) Years of Credited Service under the Pension Plan, of which at least twenty-four (24) months shall have been Credited Future Service, shall be fully Vested in the IAR Plan if, (a) He earned more than one Hour of Service on or after January 1, 1997; or (b) His accrual of benefits under the Plan was not a result of work under a Collective Bargaining Agreement.
When Can I Receive the Money in My Account?
You can receive the money in your Account at any one of the following times: at Normal, Early, Unreduced, Rule of 85 Retirement and if you are Totally and Permanently Disabled. At retirement, you can receive your entire vested Account Balance in one lump sum payment. If you die, your vested Account Balance will be paid to your beneficiary.
In no event, however, shall you be permitted to postpone the commencement of benefits to a date later than April 1 following the calendar year in which you reach age 70 ½.
Can I Borrow Some of the Money in my Individual Account?
The purpose of the Individual Account Retirement Plan is to accumulate retirement income. Participants are not permitted to borrow against or use the Individual Account except according to the rules outlined in the Individual Account Retirement Plan. The Plan does not provide loans.
Do I Have to Pay Taxes on the Money in My Individual Account?
The amount credited to your Individual Account is not considered taxable income to you until you actually receive the money. When you are paid money from your Individual Account, the money must be reported as taxable income, unless you elect to rollover the entire distribution into an Individual Retirement Account (IRA) or other tax-exempt retirement plan. Federal law requires that if you are receiving certain types of benefits from the plan, 20% must be withheld for Income Tax purposes. However, these types of benefits are also eligible for a “rollover” into an IRA or other tax-exempt retirement plan willing to accept the distribution.
When you terminate your account, you could be dealing with substantial amounts of money. It is very important that you discuss with a tax advisor whether payment of your account should be paid to you in a lump sum or to an IRA or other tax-exempt retirement plan designated by you.
What is the Application Procedure for Termination of My Account?
All applications must be in writing and filed with the Board at the Fund Office at least 30 days before payment of your Individual Account is made.
Every Participant with a Vested Percentage retiring at or after the applicable eligibility date of Article IV, shall receive a retirement benefit from the Plan. No such retirement benefits shall be paid, however, unless the Participant makes application therefore and certifies to the Board that he has retired at or after his applicable retirement date, i.e., that he has not engaged in any work for which Individual Employer Contributions are required on his account since his retirement eligibility date, and the Board approves such certification. In the case of retirement for Total and Permanent Disability, no such retirement benefits shall be paid unless the Board makes the determination provided for by the Plan.
The effective date of retirement of a Participant shall be deemed to be the first day of the calendar month following the calendar month in which the Board approves such; or in the case of retirement for Total and Permanent Disability, the calendar month in which the Board make the determination required by the Plan.
What Recourse Do I Have if I Disagree With the Denial of My Application?
Any Participant, retired Participant or other Beneficiary may file a claim for benefits under the Plan. Such claim must be in writing and submitted to the Plan Office.
If a claim is denied, the claimant will be provided with a Notice of Denial by the Board. This Notice of Denial will contain the following information
- The specific reason for denial
- Specific references to the Plan provisions upon which the denial is based
- A description of any additional information which is necessary to perfect the claim and why this information is necessary
- An explanation of the Review Procedure described in the next section.
If a claim is denied, the claimant may request a review under the following Review Procedure:
- Application for Review must be filed, in writing at the Plan office, within sixty (60) days after receipt of the Notice of Denial. The claimant may review pertinent documents or may submit comments in writing to the Board.
- After receiving the Application for Review, the Board will review the claim. A Decision on Review will normally be submitted to the claimant, in writing, within sixty (60) days. Under special circumstances, as determined by the Board, the submission of the Decision on Review to the claimant may be delayed an additional sixty (60) days.
- The claimant may request, through the Plan office, a hearing with the Board. The Board will grant a hearing to the claimant if it determines good cause is shown.
- The Decision on Review will be in writing. It will include the reasons for the decisions and reference to the specific Plan provisions which are pertinent to the decision.
No legal action may be taken with respect to a claim until all administrative remedies described herein are exhausted. Any entity reviewing the Board’s decision may not consider any facts not presented to the Board. The Board has the sole power and discretion to construe any and all of the terms of the Plan, and any such construction shall be binding on all persons concerned to the fullest extent permitted by law.
What Should I Do If the Annual Statement Does Not Show Contributions From An Employer for Whom I Worked That Year?
It is very important that you carefully check the statement that you receive from the Fund Office and notify them in writing immediately if there is any error or omission. Your account will not be credited for employer contributions due with respect to your work until the contributions have been received by the Trust.