Qualified Birth or Adoption Distributions (QBOAD):
The “Qualified Birth or Adoption Distribution” allows participants to take early withdrawals of up to $5,000, per child, from their Supplemental Retirement Plan 401(a) account. This distribution can be paid within 1 year of the birth or adoption of a child. An “eligible adoptee” is anyone that has not reached the age of 18, is physically or mentally incapable of self-support and is not the child or stepchild of the member’s spouse.
You will be required to complete and submit the QBOAD distribution form along with the child’s birth certificate to the Fund Office.
This special distribution is taxable but is not subject to the 10% early withdrawal penalty. Unless you elect otherwise on the distribution form you will be subject to 10% federal income taxes, plus any applicable state tax withholding. The distribution is taxable and you will receive a 1099 tax form from John Hancock Retirement Plan Services. You should consult your tax advisor regarding the taxes applicable to this distribution.
If you elect to receive a QBOAD, you can recontribute all or part of this distribution to the Supplemental Retirement Plan.
The Supplemental Retirement Plan allows active participants age 59 ½ or older to take withdrawals from their 401(a) account. The minimum amount is $5,000 or your entire account balance, if less. This distribution is subject to mandatory 20% Federal Income Tax Withholding, plus any applicable state tax withholding, but a 10% early withdrawal penalty is not applicable. You will receive a 1099 tax form from John Hancock Retirement Plan Services. You should consult your tax advisor regarding the taxes that are applicable to this distribution. The In-Service Distribution is eligible for rollover.
Time of Payment
The purpose of the Plan is to provide additional savings for retirement. Therefore, the Plan does not generally permit distribution of any part of your account balance until your employment terminates due to retirement, disability, resignation or discharge. However, exceptions can be made in the case of certain qualifying hardships, which are described below in a separate section.
In any case, if you are a 5% owner of a contributing employer, you must begin to receive your benefit by April 1 of the year after the year in which you reach age 70-1/2 even if you remain actively employed in the steamfitting industry. If you are a 5% owner of a contributing employer, you should advise the Fund Office of your status. If you do not do so and payments do not begin as required, you may be subject to a special 50% tax on the amounts you should have received.
Your account can be distributed if you stop working in Covered Employment or you become disabled or die. You are considered to have stopped working in Covered Employment on the last day of the second quarter in which no contributions are received on your behalf (unless you actually worked in Covered Employment after the end of the fourth quarter, but before the Fund Office has finished recording fourth quarter hours). To determine if you are Disabled the Trustees may rely upon a determination by the Social Security Administration that you are disabled within the meaning of the Social Security Act. If a Social Security determination is not available, the Trustees may rely upon a certification by a physician designated by the Plan. In all cases, the disability must be expected to be of extended duration. Distributions are generally made upon receipt of a properly completed application and are made directly to you, or, in the event of your death, to your beneficiary. If you are married, you must designate your spouse as beneficiary, unless your spouse has given a written, notarized consent for you to name another specific beneficiary. The term “spouse” means your lawful spouse, including your same-sex partner. In any case, you must begin to receive your benefit by April 1 of the calendar year after the calendar year in which you reach age 73 even should you remain actively employed in Covered Employment.
Form of Payment
Account Balance Less than $1,000
If your account value does not exceed $1,000 (or any greater amount permitted under the law), upon termination of your service for any reason, it will be paid to you in a single sum as soon as practicable after your service terminates.
Account Balance More than $1,000
If you stop working in Covered Employment, become Disabled or die and your account balance exceeds $1,000, you may choose to receive your distribution as soon as administratively possible after the valuation date next following your application for payment, or you can wait and take your distribution at a later time, but no later than April 1 of the calendar year after the calendar year in which you reach age 72 even should you remain actively employed in Covered Employment. Distribution of your account will normally be made in a single payment. However, if your Account Balance exceeds $5,000, you may elect to receive your distribution in annual or more frequent installments over a period as limited under the Plan or in two or more partial payments of your account.
A participant, with an account balance of $800, stops working in Covered Employment (see below) at age 32. The Plan will distribute his benefit in a single payment as soon as administratively possible after he stops working in Covered Employment.
A participant, with an account balance of $35,000, stops working in Covered Employment (see below) at age 45. The participant may choose to either (i) receive his distribution as soon as administratively possible after he stops working, or (ii) wait to receive his distribution until a later date.
If he decides to wait to receive his benefit, his account will continue to be invested under the Plan in accordance with his instructions and charged for Plan expenses in the same manner as an active participant. His account will be distributed to him when he elects a form of distribution.
You are considered to have stopped working in Covered Employment on the last day of the second quarter in which no contributions are received on your behalf (unless you actually worked in Covered Employment after the end of the second quarter, but before the Fund Office has finished recording second quarter hours).
Please note that special notices and election forms apply to each distribution choice. You should contact the Fund Office for more information.
A hardship distribution may be available for the following purposes:
to pay the cost of post-high school education for you or a member of your immediate family at an accredited institution of higher learning
- to pay uninsured medical or dental expenses for you or a member of your immediate family for which there is no reimbursement from any other source
- to purchase your principal residence
- to prevent your eviction from or foreclosure upon your principal and only residence
- to assist you if you are partially and/or temporarily disabled so as to be unable to work in Covered Employment, but only if you have exhausted all other resources available to you
- to help you recover from damage from a natural disaster (such as a hurricane) if...
- the area you live and/or work in has been declared a federal disaster area,
- you suffered material damage as a result of the natural disaster, and
- the damage you suffered consists of physical injury or property damage which will restrict your ability to work and care for your family
- Funeral or burial expense for a deceased parent, child, or dependent.
- Repair of a principal residence due to flood, water or other loss.
If you think you have incurred a hardship which would justify a withdrawal, contact the Fund Office to request an application form. You will be required to present evidence of your hardship and to certify that you have no other resources with which to meet your need. In any case, your withdrawal cannot reduce your account balance below $100.
If you die before you receive your entire benefit under the Plan, the full value of your accounts will be paid to your designated beneficiary. As soon as feasible after your death, your account balance will be transferred to the New York Life Stable Value Fund pending identification of your beneficiary.
If you are married, you must designate your spouse to receive your entire account balance, unless your spouse has given a written, notarized consent to another specific beneficiary or consented to all future changes of your beneficiary designation. The Plan reserves the right to reject any designation of multiple or successive beneficiaries if it would be unduly burdensome to the Plan.
If a beneficiary designation is not in effect at the time of your death, the Plan will pay your benefit to your spouse, if living, otherwise to your estate.
If your beneficiary is not your spouse, the Plan will pay the beneficiary in a single sum as soon as reasonably feasible after your death.
If your spouse is your beneficiary, your spouse may elect to receive the benefit immediately, or may delay payment for any period, but not beyond what would have been your normal retirement date. If payment is deferred, your spouse may direct the investment of your account until a distribution is made and your account will be charged fees in the same way as when you were alive.
Non-Assignability of Interest
Apart from your right to name a beneficiary to receive any distribution payable upon your death, federal law requires that no right to payment under the Plan can be subject to sale, transfer, pledge, assignment, anticipation, attachment or encumbrance of any kind. However, the Plan is required to honor any Federal income tax levy or any qualified domestic relations order which directs it to pay all or a part of a participant’s benefit to his former spouse, children or other dependent.
If you are unable to care for your affairs at the time when you would otherwise receive your benefit and you do not have a duly appointed legal guardian, the Plan trustees, in their discretion, may pay your benefit for your support or for the support of your spouse and any minor children, in full discharge of the Plan’s obligation to you.
Amendment and Termination of the Plan
The Trustees have reserved the right to amend or terminate the Plan at any time for any reason. Any action amending or terminating the Plan will be taken by the Board of Trustees of the Steamfitters’ Industry Supplemental Retirement Fund, the Plan sponsor, which may act at a meeting or by written consent. If the Plan is terminated for any reason, your account values will remain 100% vested.