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As in all walks of life, planning is the essential ingredient to getting where you want to be. You already have two elements in place – your Pension provides a monthly “fixed income” when you retire and your Health & Benefit (H&B) provides health coverage for you while you are active right on through retirement – but you have a third plan that provides additional security.

The Annuity Fund acts as a buffer in times of need when you are working – through supplemental benefits when out of work or disabled, educational reimbursements for you & your dependents higher education expenses, and in-service options to supplement those special needs or projects that happen in our lives – mostly as a complement to your Pension and H&B Plans after retirement.

Unlike the Pensiona fixed amount monthly – or the H&Bwhich is strictly for health expenses-, the Annuity Fund provides “lump-sum” amounts that you can utilize or grow as your needs dictate. Therefore, the most important part of the process is continually developing and building the Annuity Fund to fill your present and even more critically, your future needs.

As important as it is to have the “extra cash” in times of need during your active employment years, it is doubly important to grow a “nest egg” to provide for those times in our retirement – when we no longer have other streams of income – when you require additional funds. Invested conservatively in the Annuity Fund, your account can supplement these needs.

A complete copy of the Summary Plan Description (SPD) is available at the Fund office.

Please click on the link shown to download forms.

http://ibew236funds.org/forms

Plan Highlights · Plan Financing · Participant’s Accounts

Plan Highlights

  • Distributions from the Annuity Fund constitute a direct reduction against your balance in the Fund and any amounts withdrawn from the Fund will not be eligible for any allocations (see #9) at the next Valuation Date (end of each quarter- March 31, June 30, September 30, and December 31 each year. ex.- a withdrawal between January 1 and March 31 will not accrue nor be eligible for any allocation at March 31).  Only monies in the account at the specific period end will be eligible.
  • Disbursements from the Fund are considered “eligible rollovers” and therefore may be taken in one of two forms: either as a direct payment to a qualified investment plan (your existing 401k or an IRA) (no taxes withheld) or as a check directly to you. We are required to withhold 20% to be remitted as federal withholding taxes.  Remember, when you file your tax returns in the following year, you may also be liable for state income taxes, and, in the event you take the disbursement before you turn 59.5 years old, those withdrawals paid directly to you will likely be assessed an additional “non-waivable” 10 % federal tax for an early withdrawal.

Normal Annuity (p. 7)

Eligibility: At least age 55 and no longer working in covered employment.

  • Benefit: Can be paid either as a:
  1. monthly based upon a percentage and the amount of your annuity account
  2. through an insurance contract (through a separate company) based upon the rates in effect at the time of your retirement.
  3. as a lump sum – either as a rollover or directly to you.

Disability Annuity (p. 9)

  • Eligibility: Not yet age 55, no longer working in covered employment and entitled to a New York State disability benefit, a Worker’s Compensation benefit, or a Social Security disability benefit.
  • Benefit: Paid monthly or weekly dependent upon which disability benefit is awarded. Monthly benefit is the same as a normal annuity. Weekly benefit is a discretionary amount limited to certain allowable amounts.

Termination Annuity (p. 10)

  • Eligibility: Not yet age 55 and not working in covered employment for at least one week.
  • Benefit: $125.00 paid weekly (may be raised to $375.00 after 25 consecutive weeks without employment). Proof must be provided of no employment. A computer is set up at the Fund office so that members may obtain their information from the NYSDOL unemployment benefit website.

Education Benefit (p. 11)

  • Eligibility: Must be a participant with an account balance with self, spouse, or dependent in attendance at an educational facility of higher education which grants certificates or degrees
  • Benefit: Lump sum payment for eligible school cost incurred subject to limitations.

In-Service Benefit (p. )

  • The amount of the In-Service Benefit will be the amount you request, but not more than 50% of the balance of your Annuity Account on the date the In-Service Benefit is paid, up to a maximum disbursement of twelve thousand five hundred dollars net of withholding. (i.e. your account will be assessed $12,500.00 either as a rollover or if disbursed directly to you. However, if disbursed directly to you, the check would be $10,000.00, and $2,500.00 would be withheld and remitted to the IRS as federal withholdings).

Spouse’s Benefits (p. 7)

  • Eligibility: Must be lawfully married at annuity starting date.
  • Benefit: Either as:
  1. Actuarially reduced normal annuity paid monthly for participant’s lifetime with 50% of that amount paid to surviving spouse after participant’s death.
  2. as a lump sum – either as a rollover or directly to your spouse.

Death Benefit (p. 12)

  • Eligibility: Must be a participant with an annuity account balance and not yet receiving annuity payments through an insurance company.
  • Benefit: Lump sum payment of annuity account balance.

Vesting (p. 6)

  • Eligibility: One hour of work in covered employment.

IMPORTANT: THIS IS ONLY A VERY SHORT SUMMARY OF THE PLAN BENEFITS. PLEASE READ THE WHOLE BOOKLET.

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Plan Financing

A most important element of your Annuity Plan is money. Where it comes from, how it is managed and to what uses it may be put is described below.

1. Who pays for the Plan?

The employers who have collective bargaining agreements with Local 236 that call for contributions to the Plan. Also, money is transferred to this Plan when you work in other participating locals’ jurisdictions requiring contributions to a defined contribution plan in accordance with any reciprocal agreement that might exist between this Plan and another.

2. How are the Plan moneys managed?

All of the Plan’s assets are held in trust by the Trustees for the participants and beneficiaries of the Plan. The Board of Trustees has the ultimate responsibility for the management of Plan money. However, the Board is allowed, under law, to hire professional investment managers to provide the expert assistance in this very complex field of managing Plan money.

3. May I contribute to the Plan?

In general, you are not permitted to contribute to the Plan. However, you may transfer to the Plan all or a portion of any Eligible Distribution from another retirement plan qualified under Section 401(a) of the Internal Revenue Code or from an Individual Retirement Account (IRA) containing only assets from an Eligible Distribution. You shall be fully vested in the funds that are transferred into your annuity account at all times.

Transfers are subject to many specific requirements. If you will be receiving an Eligible Distribution from another qualified retirement plan and are interested in making a transfer to this Plan, you should contact the Fund office.

4. May I borrow from my Annuity account?

No. Effective September 1, 2000 loans are no longer permitted from this Annuity Plan. Loans made before September 1, 2000 may be paid back in accordance with the rules in effect at the time the loans were made.

5. Can any part of my Annuity account be assigned to someone else?

No, Plan provisions prohibit assignment of your annuity for the payment of any obligation. Thus, your interest in the Plan is not subject to assignment or alienation, whether voluntary or involuntary. However, there is an exception for a Qualified Domestic Relations Order (QDRO). A QDRO is a court order specifying that a specific amount of your benefit must be paid to your child, former spouse, or other person. (See question 43 in SPD). In addition, in recent court decisions, specific child-support judgements have successfully contested the non-assignment clause.

6. When I retire, may I take a cash settlement instead of monthly or weekly payments?

Yes. This option is available to you if you are applying for a normal annuity or a termination annuity.

7. If the Plan is discontinued, what will happen to the assets of the Plan?

The assets of the Plan are to be used for the benefit of the participants, surviving spouses and beneficiaries, in an order of priority that is set forth under Federal law. If the Plan is discontinued, you will be entitled to Plan benefits based upon the balance in your account at the time. Under no circumstances may money, which has been properly contributed to the Plan, ever be returned to any employer or the Local Union.

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Participant Accounts

Your benefits under this Plan come directly from your Annuity account. Your Annuity account balance can increase or decrease for several reasons. The information below will explain what your annuity account is and how it is managed.

8. What is an annuity account?

Once contributions from your employer start coming into the Fund, the Trustees will set up an account for you. This is called your Annuity account.

9. How does my annuity account balance change?

As contributions are received by the Fund on behalf of your work, they are added to your annuity account. Any benefits paid to you, or your beneficiary, are subtracted from your annuity account.

In addition, on a quarterly basis, the Trustees will make an allocation to every active participant’s annuity account based upon their share remaining in the Fund at the allocation date. The allocation (positive or negative) is based upon the results of operations for the Fund taken as a whole for that period. These results consist of all activity, including all investment income and all expenses incurred by the Fund. Investment income includes, but is not limited to interest received, realized gains, and losses on investments sold, and unrealized gains and losses on investments held at the end of the period, less any and all applicable investment fees. Expenses are those applicable administration expenses of operating the Plan. Those expenses include, but are not limited to: operational expenses, such as wages, rent, telephone, office supplies, and utilities; professional fees, such as auditing, accounting, actuarial, legal, and information technology; and other miscellaneous expenses.

10. Do I own my annuity account?

Technically, the Trustees of the Plan own your annuity account. However, once you are a participant in the Plan, you are 100% vested and remain so as long as you have a balance in your annuity account. This means that you or your beneficiary will receive the value of your account less any administrative charges (none currently) that might be levied.

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