| (a) A domestic relations order entered by a court of
competent jurisdiction on January 1, 2015 or after must be in a form
prescribed by TRS. The form prescribed by TRS must ensure compliance
with the requirements in subsection (b) of this section.
(b) For domestic relations orders entered by a court
of competent jurisdiction before January 1, 2015, TRS shall apply
the statutory criteria to determine whether an order is a QDRO. The
following provisions shall also be used in making the determination.
(1) The order must provide for each possible distribution
by the retirement system for the member or retiree. This requirement
may be met by a provision that:
(A) awards a specified or clearly determinable percentage,
rather than an amount, of each distribution by TRS based on the participant's
account; or
(B) awards all benefits not specified to the participant
to be paid in accordance with plan provisions.
(2) The order must provide for reducing the amount
awarded in the event of reduction of the benefit based on the age
of the participant, each reduction to be in proportion to the factors
used to reduce the standard annuity on the basis of the participant's
age below normal retirement age. This requirement shall not apply
if:
(A) the order awards a percentage of whatever monthly
benefit is payable after all elections have been made by the member,
or in the event of death benefits, by the designated beneficiary;
(B) the member or retiree has reached normal retirement
age and, if a retiree, has retired without any reduction for early
age retirement at the time of the determination as to whether the
order is a QDRO; or
(C) the order reflects that the retiree is, or will
be receiving, retirement benefits reduced for early age retirement
and the award to the alternate payee has considered the reduced amount
of the retiree's annuity payments.
(3) The order may not:
(A) purport to require the designation by the participant
of a particular person as the recipient of benefits in the event of
a member's or annuitant's death;
(B) purport to require the selection of a particular
payment plan or benefit option;
(C) require any action on the part of the retirement
system contrary to its governing statutes or plan provisions other
than the direct payment of the benefit awarded to an alternate payee;
or
(D) award any interest in distributions by the retirement
system contingent on any condition other than those conditions resulting
in the liability of the retirement system for payment under its plan
provision.
(4) A QDRO may not provide for the award of a specific
amount of a benefit, rather than a percentage of this benefit, to
an alternate payee unless the order also provides for a reduction
of the amount awarded in the event that the benefits available to
the retiree or member are reduced by law. This requirement shall not
apply to benefit waivers executed by the participant.
(5) If the order intends to award the participant the
full amount of any future benefit increases that are provided or required
by the legislature, the order must explicitly state such. TRS, its
board of trustees, and its officers and employees shall not be liable
for making payment of part of any future benefit increases to any
person if the order so requires or if the order awards a percentage
of benefits payable and does not explicitly state that future benefit
increases are awarded solely and completely to the plan participant.
(6) An order that purports to give to someone other
than a member the right to designate a beneficiary or choose any retirement
plan available from TRS is one that requires an action contrary to
TRS' governing statute and plan provisions and therefore is not a
QDRO.
(7) An order that attaches a lien to any part of amounts
payable with respect to a member or retiree is one that requires an
action contrary to TRS' governing statute and plan provisions and
therefore is not a qualified domestic relations order.
(8) An order that awards an alternate payee a portion
of the benefits payable with respect to a member or retiree under
TRS and that purports to require TRS to make a lump sum payment of
the awarded portion of the benefits to the alternate payee that are
not payable in a lump sum is one that requires action contrary to
TRS' governing statute and plan provisions and therefore is not a
QDRO.
(9) An order shall specify the date of the marriage.
(10) An order that allocates the participant's investment
in contract in a manner not in compliance with any requirements of
the Internal Revenue Code and applicable regulations is not a QDRO.
An order that does not allocate a participant's investment in contract
may be determined to be a QDRO if it provides sufficient information
for TRS to make the allocation in accordance with applicable laws
and regulations.
(11) An order that purports to require a member to
terminate employment, to withdraw contributions, or to apply for retirement,
is not a QDRO.
(12) The order must satisfy the requirements of Internal
Revenue Code §414(p)(1)(A)(i) and §414(p)(1)(B).
(13) The order may contain provisions consistent with §824.1012
or §824.1013, Government Code, and TRS may rely on the provisions
of the order as though the provisions were included in the decree
of divorce or order accepting a property settlement.
(14) The order may specify an alternative method for
the parties to verify their Social Security numbers to TRS, if the
court finds that omission of the numbers in the order is necessary
to reduce the risk of identity theft. The order is not a QDRO if TRS
finds that the method of verification is insufficient for the purpose
of payment of benefits or reporting of income for tax purposes.
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| Source Note: The provisions of this §47.10 adopted to be effective September 29, 1989, 14 TexReg 4785; amended to be effective March 12, 2003, 28 TexReg 2118; amended to be effective March 8, 2007, 32 TexReg 1097; amended to be effective June 20, 2013, 38 TexReg 3801; amended to be effective December 23, 2014, 39 TexReg 10031 |
