Texas Government Code 824.204 – Optional Service Retirement Benefits
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(a) Instead of the standard service retirement annuity payable under § 824.203 or an annuity reduced because of age under § 824.202, a retiring member may elect to receive an optional service retirement annuity, reduced for early retirement if applicable, under this section. An election to receive an optional service retirement annuity must be filed with the board of trustees not later than the effective date of retirement.
(b) An optional service retirement annuity is an annuity payable throughout the life of the retiree and is actuarially reduced from the annuity otherwise payable under this subtitle to its actuarial equivalent under the option selected under Subsection (c).
Terms Used In Texas Government Code 824.204
- Annuity: A periodic (usually annual) payment of a fixed sum of money for either the life of the recipient or for a fixed number of years. A series of payments under a contract from an insurance company, a trust company, or an individual. Annuity payments are made at regular intervals over a period of more than one full year.
- Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
- Person: includes corporation, organization, government or governmental subdivision or agency, business trust, estate, trust, partnership, association, and any other legal entity. See Texas Government Code 311.005
- Remainder: An interest in property that takes effect in the future at a specified time or after the occurrence of some event, such as the death of a life tenant.
- Written: includes any representation of words, letters, symbols, or figures. See Texas Government Code 311.005
(c) An eligible member may select one of the following options, which provide that:
(1) after the retiree’s death, the reduced annuity is payable to and throughout the life of the person nominated by the retiree’s written designation filed prior to retirement;
(2) after the retiree’s death, one-half of the reduced annuity is payable to and throughout the life of the person nominated by the retiree’s written designation filed prior to retirement;
(3) if the retiree dies before 60 monthly annuity payments have been made, the remainder of the 60 payments are payable to the designated beneficiary;
(4) if the retiree dies before 120 monthly annuity payments have been made, the remainder of the 120 payments are payable to the designated beneficiary; or
(5) after the retiree’s death, three-fourths of the reduced annuity is payable to and throughout the life of the person nominated by the retiree’s written designation filed prior to retirement.
(d) If a person who is nominated by a retiree in the written designation under § 824.101 predeceases the retiree, the reduced annuity of a retiree who has elected an optional service retirement annuity under Subsection (c)(1), (c)(2), or (c)(5) shall be increased to the standard service retirement annuity that the retiree would otherwise be entitled to receive if the retiree had not selected that annuity option. The standard service retirement annuity shall be adjusted as appropriate for:
(1) early retirement as provided by § 824.202; and
(2) postretirement increases in retirement benefits authorized by law after the date of retirement.
(e) The increase in the annuity under Subsection (d) begins with the payment due at the end of September, 1995, or the first monthly payment made to the retiree following the date of death of the person nominated, whichever is later, and is payable to the retiree for the remainder of the retiree’s life.
(f) The board of trustees shall adopt separate tables to be used to reduce an optional service retirement annuity under Subsection (d) to the actuarial equivalent of the standard service retirement annuity.