ETF 20.04 Note Note: This rule (CR 09-057) concerns the optional forms of an annuity and updates the existing rule to better reflect ongoing changes in federal regulations and to more clearly state that the number of guaranteed payments is to equal the number of full calendar months in the annuitant’s life expectancy.

ETF 20.04 History History: Cr. Register, November, 1982, No. 323, eff. 12-1-82; am. (intro.), renum. (2) to be (3) and am., cr. (2), Register, May, 1987, No. 377, eff. 11-1-87; cr. (4), Register, December, 1996, No. 492, eff. 1-1-97; CR 01-096: am. (1), (2) (a) to (e) and (g) and (3), Register December 2001 No. 552, eff. 1-1-02; CR 09-057: am. (2) (b) to (g) and (4) Register May 2010 No. 653, eff. 6-1-10; correction in (2) (c) made under s. 13.92 (4) (b) 7., Stats., Register May 2010 No. 653; CR 19-126: am. (4) Register May 2021 No. 785, eff. 6-1-21.

ETF 20.045 ETF 20.045 Changes to optional form of payment.

ETF 20.045(1) (1) Changing the form of payment from a lump sum payment under s. 40.25 (1) or (4), or 40.73 (1) (a), Stats., to an annuity under s. 40.24 (1) or 40.73 (3), Stats., or from an annuity to a lump sum payment, is subject to the option change deadline specified in s. 40.24 (4), Stats.

ETF 20.045(2) (2) 

ETF 20.045(2)(a) (a) If a participant, alternate payee or beneficiary has made a timely request under sub. (1) to change from a lump sum payment to a monthly annuity, the effective date of the annuity shall be determined based on the original date on which the department received the original application for benefits.

ETF 20.045(2)(b) (b) If the department receives a timely payment option change request after the lump sum payment has already been issued, or receives it too late to prevent the payment from being issued, the applicant must return the payment in full within 30 calendar days after the date on which the department received the option change request. If the lump sum payment is not returned within the 30-day period, the option change request is null and void.

ETF 20.045(2)(c) (c) The department shall not commence making annuity payments before the department has received the returned lump sum payment.

ETF 20.045(3) (3) If a participant, alternate payee or beneficiary has made a timely request under sub. (1) to change from a monthly annuity to a lump sum payment after one or more monthly payments have been issued, or if the department receives the option change request too late to prevent a monthly payment from being issued, the amount of the annuity payments that would have been paid under the terminated annuity if the annuity had been a straight life annuity shall be deducted from the lump sum payment that would otherwise have been payable.

ETF 20.045 Note Note: This rule (CR 09-057) codifies the department interpretation that the deadline for making a change to an optional form of payment is 60 days after the date on which the first annuity check is issued or funds are otherwise transferred. If the request for a payment option change is received by the department too late to prevent the lump sum payment, the applicant has 30 calendar days from the date of the request to return the payment in full.

ETF 20.045 Note If the request is received too late to prevent issuance of one or more monthly payments, the value of the payments issued shall be deducted from the lump sum payment.

ETF 20.045(4) (4) Subject to the restrictions in s. 40.24 (7) (a), Stats., a participant’s request to change the designation of a named survivor to a different named survivor shall be subject to the deadline specified in s. 40.24 (4), Stats., for changing the optional form of payment selected.

ETF 20.045 History History: CR 09-057: cr. Register May 2010 No. 653, eff. 6-1-10; CR 11-040: cr. (4) Register July 2012 No. 679, eff. 8-1-12.

ETF 20.05 ETF 20.05 Accelerated payment annuity options.

ETF 20.05(1) (1) A participant, alternate payee or beneficiary shall not be eligible for the accelerated payment annuity if the reduced annuity payable for life in the normal form under s. 40.24 (1) (e), Stats., would be equal to or less than $129 per month for a benefit with an effective date in calendar year 2001 or, for a benefit with an effective date in a subsequent calendar year, the monthly amount applied under this section for the previous calendar year increased by the salary index, as defined in s. 40.02 (52), Stats., ignoring fractions of the dollar.

ETF 20.05(2) (2) Pursuant to s. 40.03 (2) (k), Stats., the department will assume that the primary OASDHI benefit, as defined in s. 40.02 (44), Stats., for a person eligible to receive a beneficiary annuity and selecting an option payable under s. 40.24 (1) (e), Stats., will be based on the work record of the participant from whose account the benefit is being paid.

ETF 20.05 History History: Cr. Register, June, 1979, No. 282, eff. 1-1-80; cr. (2), (1) renum. from ETF 7.02 (1) and am., Register, November, 1982, No. 323, eff. 12-1-82; am. (1), Register, December, 1987, No. 384, eff. 1-1-88; CR 01-096: am. (1) and (2), Register December 2001 No. 552, eff. 1-1-02.

ETF 20.055 ETF 20.055 Spouse’s or domestic partner’s signature on a benefit application. Documentation of inability to obtain a spouse’s or domestic partner’s signature on an annuity application as required under s. 40.24 (7) (a) or s. 40.25 (3m), Stats., or on a separation benefit application as provided in s. 40.25 (3m), Stats., shall be accepted for any of the following reasons:

ETF 20.055(1) (1) 

ETF 20.055(1)(a) (a) The spouse or domestic partner is incompetent as defined under s. 54.10 (3), Stats., and a copy of the court order appointing the spouse’s or domestic partner’s guardian is submitted to the department.

ETF 20.055(1)(b) (b) The guardian’s signature shall be required on the annuity application in lieu of the spouse’s or domestic partner’s signature if the participant chooses an annuity option other than an option specified under s. 40.24 (7) (a) or 40.25 (1) (a), Stats.

ETF 20.055(1)(c) (c) The spouse’s, domestic partner’s or guardian’s signature is not required when the participant is only eligible for a single sum benefit payable under s. 40.25 (1) (a), Stats.

ETF 20.055(2) (2) The participant certifies, on a form provided by the department, that the participant does not now know and has not known the whereabouts of the spouse or domestic partner for at least the 90 days immediately prior to the date the application is signed, or the participant provides evidence to the department’s satisfaction that the spouse’s or domestic partner’s signature is otherwise not obtainable.

ETF 20.055 Note Note: Section ETF 20.055 (2) requires a form which can be obtained at no charge by writing to: department of employee trust funds, P.O. Box 7931, Madison, WI 53707-7931, or by calling: [phone] or toll free at [phone].

ETF 20.055(3) (3) The requirements in s. 40.24 (7) (a) (intro.) and (b), Stats., and in s. 40.25 (3m), Stats., as it applies to s. 40.25 (1) (b), Stats., related to the requirement for the domestic partner’s signature on benefit applications, shall not apply if the participant is prohibited under the internal revenue code from selecting a joint and survivor annuity with the domestic partner as the named survivor, based on the participant’s and domestic partner’s respective ages.

ETF 20.055 History History: Cr. Register, September, 1986, No. 369, eff. 10-1-86; EmR0938: emerg. am. eff. 1-1-10; CR 10-004: am. Register July 2010 No. 655, eff. 8-1-10; CR 10-137: am. Register August 2011 No. 668, eff. 9-1-11.

ETF 20.06 ETF 20.06 Early retirement reduction factors. Pursuant to s. 40.23 (2), Stats., this section applies only to participants who are not participating employees after March 9, 1984. In computing a formula annuity in the normal form beginning prior to the normal retirement date of a participant, there shall be a .5% reduction for each month the participant’s age is under 65 but at least 60 and a .4% reduction for each month the participant’s age is under 60.

ETF 20.06 History History: Cr. Register, June, 1979, No. 282, eff. 1-1-80; renum. from ETF 7.02 (2), Register, November, 1982, No. 323, eff. 12-1-82; am. Register, March, 1986, No. 363, eff. 4-1-86.

ETF 20.07 ETF 20.07 Annuity options — automatic distributions.