§ 24-7-706 - Annuity options.
24-7-706. Annuity options.
(a) (1) Before the date the first payment of his or her annuity becomes due, but not thereafter, a member may elect to receive his or her annuity as a straight life annuity, or he or she may elect to receive the actuarial equivalent, at that time, of his or her straight life annuity in a reduced annuity payable throughout his or her life.
(2) The member may nominate a beneficiary, in accordance with the provisions of one (1) of the following options:
(A) Option A -- 100% Survivor Annuity. (i) Under Option A, upon the death of a retirant, his or her reduced annuity shall be continued throughout the life of and paid to such person as he or she shall have nominated by written designation duly executed and filed with the board before the date the first payment of his or her annuity becomes due.
(ii) (a) The person must be either his or her spouse for not less than one (1) year immediately preceding the first payment due date, or another person forty (40) years of age or older receiving more than one-half (1/2) support from the retirant for not less than one (1) year immediately preceding the first payment due date.
(b) However, the age-forty requirement shall not exclude the designation as beneficiary of a dependent child who has been adjudged physically or mentally incapacitated by a court of competent jurisdiction;
(B) Option B -- 50% Survivor Annuity. (i) Under Option B, upon the death of a retirant, one-half (1/2) of his or her reduced annuity shall be continued throughout the life of and paid to such person as he or she shall have nominated by written designation duly executed and filed with the board before the date the first payment of his or her annuity becomes due.
(ii) (a) The person must be either his or her spouse for not less than one (1) year immediately preceding the first payment due date, or another person forty (40) years of age or older receiving more than one-half (1/2) support from the retirant for not less than one (1) year immediately preceding the first payment due date.
(b) However, the age-forty requirement shall not exclude the designation as beneficiary of a dependent child who has been adjudged physically or mentally incapacitated by a court of competent jurisdiction;
(C) Option C -- Annuity for Ten (10) Years Certain and Life Thereafter. (i) Under Option C, a retirant shall receive a reduced annuity payable throughout his or her life with the provision that if he or she dies before he or she has received one hundred twenty (120) monthly annuity payments, the payments will be continued for the remainder of the period of one hundred twenty (120) months and paid to such persons in equal shares as the retirant shall have nominated by written designation duly executed and filed with the board.
(ii) If the designated beneficiaries predecease the retirant, the retirant may nominate successor beneficiaries or may elect to return to his or her single lifetime benefit equivalent by written designation duly executed and filed with the board to be effective the month following receipt of his or her election by the Arkansas Teacher Retirement System.
(iii) If no designated beneficiary survives him or her, the annuity reserve for the remainder of the annuity payments shall be paid to the retirant's estate.
(iv) If the last designated beneficiary receiving annuity payments dies before all annuity payments are made, the annuity reserve for the remainder of the annuity payments shall be paid to the beneficiary's estate.
(v) Effective the month following completion of the one-hundred-twenty-month period, the retirant's annuity shall return to his or her single lifetime benefit equivalent.
(b) (1) At the written election of the retirant, the death of the beneficiary or divorce or other marriage dissolution after retirement from a spouse designated as beneficiary shall cancel any optional plan elected at retirement and shall return the retirant to his or her single lifetime benefit equivalent, to be effective the month following receipt of his or her election by the system.
(2) (A) A retirant who is receiving a single lifetime benefit and who marries after retirement may elect to cancel his or her single lifetime benefit and may elect Option B -- 50% Survivor Annuity providing continuing lifetime benefits to his or her spouse, but only if the election is on a form approved by the system and is received by the system within six (6) months after the date of marriage.
(B) The election shall be effective the first day of the month following its receipt.
(c) If a member fails to elect an option, his or her annuity shall be paid to him or her as a straight life annuity.
(d) (1) Notwithstanding anything contained in this section to the contrary, the residue beneficiary under 24-7-709 may elect to cancel the form of annuity in effect and elect Option A -- 100% Survivor Annuity upon the death of a retirant on or after July 1, 1989, if:
(A) The retirant died within one (1) year following the effective date of retirement;
(B) The retirant was receiving a straight life annuity; and
(C) The residue beneficiary otherwise qualifies for an Option A -- 100% Survivor Annuity.
(2) The election to change may be made only one (1) time and shall be on a form approved by the system.
(3) The election form must be received by the system within one hundred twenty (120) days of the death of the retiree.
(e) (1) Notwithstanding anything in this section to the contrary, a retirant who retired on or after July 1, 1994, may elect to cancel his or her election made at retirement for receiving an annuity and elect another option, provided that he or she:
(A) Does so within one (1) year after July 1, 1995, or within one (1) year of retirement;
(B) Files with the system a new election form approved by the system; and
(C) (i) Repays to the system the difference between the amount of the annuity received when he or she retired and the new annuity due as a result of the election change, plus interest from July 1, 1994, or his or her retirement date, whichever is later, to the date of payment in full.
(ii) The difference shall be calculated retroactively to July 1, 1994, or his or her retirement date, whichever is later.
(2) The election to change shall be made only one (1) time.
(3) The election change shall be effective retroactively to the effective date of his or her annuity.