Rollover ASA
Non-retired Members
Annuity Savings Account
Upon a member's enrollment into the Fund, an individual Annuity Savings Account will be established for the member. The Annuity Savings Account is comprised of all employee contributions and employer pickup contributions. Gains/losses are credited to a member's account at the end of every quarter, based on the member’s investment elections.
All Fund members are required by state law to contribute three-percent (3%) of their annual compensation to their Annuity Savings Account. This contribution can be made by the employer (employer pickup). Active Fund members may also make voluntary contributions in excess of the mandatory amount to their Annuity Savings Account. The voluntary contributions must be made in one- percent increments up to a maximum of ten-percent (10%). Thus, the maximum amount of contributions that active members can make to their Annuity Savings Account is thirteen-percent (13%) of their annual compensation.
Post-tax contributions are deducted from your pay after all other deductions have been made. Contributions made to TRF on a post-tax basis will have no future tax liability. Pre-tax contributions are deducted prior to calculating your current income tax withholding, thus reducing your current taxable income. Contributions made on a pre-tax basis will be taxed at the point that they are actually received by the member.
Provided the member meets certain eligibility requirements, the additional voluntary contributions may be made on either a pre-tax or post-tax basis. In order for these contributions to be pre-tax, (employment taxes still apply) the following requirements must be met:
- The employing school corporation must adopt a resolution enabling their members to participate in this plan.
- The member must have at least 5 years of TRF service as of the end of the previous fiscal year.
- The member must apply within their 2-year election window. If the employing school corporation elected to participate in the program by December 31, 2003, the 5-year member’s window expires on 8/31/05. For an employing unit that elects to participate between January 1, 2004 and August 31, 2004, the 5-year member’s election window is from 9/1/04 through 8/31/06. For a member who does not yet have 5 years of service, their election window begins September 1 after the fiscal year in which they complete their 5th year of service.
- The member must complete and submit to TRF an irrevocable payroll deduction authorization form.
Investing Annuity Savings Account Money
The Indiana Constitution was amended in 1996 to provide Fund members with more investing options. The Fund’s staff has composed an informational pamphlet, "Investing Your Annuity Savings Account," for members to use in understanding the different investment options available to them. Please consult this pamphlet for detailed information concerning the available options and the necessary procedures for changing an investment portfolio. Members may obtain a copy of this pamphlet by either contacting the Fund or visiting the Fund's Internet home page.
As a result of the Public Referendum in 1996, the Fund now offers five investment options to our members:
- Guaranteed Fund - The rate for this fund is determined annually by the Fund’s Board of Trustees. The balance of each member’s account at the beginning of the quarter is credited interest at the end of each quarter.
- Bond Fund - This fund consists of a broad range of corporate, government, and agency instruments. It can have up to 10% in high yield bonds and up to 10% in non-U.S. fixed-income instruments. The objective of the fund, over the long term, is to outperform the Lehman Brothers Aggregate Bond Index. Investment in this fund involves risk.
- International Equity Fund - This fund consists of securities of developed, non-U.S. countries. This fund’s objective is, over the long term, to provide returns in excess for a broad international market includes (EAFE: Companies from Europe, Australia, and the Far East). Investment in this fund involves risk.
- S&P 500 Index Fund - This fund closely tracks the return on the S&P 500 Index by employing an indexing strategy that invest in the stocks of the S&P 500 Index companies. Investment in this fund involves risk.
- Small Cap Equity Fund - This fund consists of stocks with a market capitalization of less than $1.5 billion. This fund’s objective is, over the long term, to provide total returns in excess of the Russell 2000 Index Fund (2000 selected small capitalized public companies). Investment in this fund involves risk.
Rollover Annuity Savings Account
The Rollover Annuity Savings Account (Rollover Account) is another approach to save for retirement. This account may be created by rolling funds from another tax-deferred retirement account into a Rollover Annuity Savings Account. The Indiana State Teachers’ Retirement Fund is a qualified governmental retirement plan as described in Section 401(a) of the Internal Revenue Code. A copy of the Fund’s Qualification Letter is available for inspection upon request.
Pursuant to Indiana Code 5-10.2-3-10 and to the extent permitted by the Internal Revenue Code and the applicable regulations, the Indiana State Teachers’ Retirement Fund, on behalf of any active member, will accept a rollover distribution into a rollover account from any of the following:
(1) A qualified plan described in Section 401(a) or Section 403(a) of the Internal
Revenue Code.
(2) An annuity contract or account described in Section 403(b) of the Internal
Revenue Code.
(3) An eligible plan maintained by a state, a political subdivision of a state, or an
agency or instrumentality of a state or political subdivision of a state under
Section 457(b) of the Internal Revenue Code.
(4) An individual retirement account or annuity described in Section 408(a) or
Section 408(b) of the Internal Revenue Code.
Note: We cannot accept the rollover of any after-tax funds. Therefore a rollover from a Roth IRA is not permitted.
The rollover account is maintained separate from the member’s Annuity Savings Account (ASA) and can be invested in any of the Fund’s alternative investment options, except the Guaranteed Fund. Investment allocations may be changed quarterly, please download the Investment Allocation Form for your Rollover Account. Note: If an Investment Allocation Form is not received, the rollover funds will automatically be placed in the Money Market Fund by default until TRF receives an Investment Allocation Form from the member. You may check our information and performance records of our annuity savings. Additionally, beneficiaries may be named for this account independently of those listed on your required ASA.
Members may withdraw their Rollover Account balance at any time. Note: the Rollover Account balance must be withdrawn in full. If distribution is delayed until the time of retirement, you may choose to add to your monthly benefit through a lifetime annuity, to withdraw the entire amount, or to defer distribution until a later time.
A lump sum withdrawal may be made at any point before retirement from the member’s rollover account. At retirement, a member may withdraw from their rollover account in accordance with the retirement options that are available for the member's ASA, including the deferral of a withdrawal.
Rollover checks should be made payable to:
Indiana State Teachers’ Retirement Fund FBO (Member’s Name)
150 West Market Street, Suite 300
Indianapolis, IN 46204-2809
After the end of each fiscal quarter, all members with a balance in their Annuity Savings Accounts and a current address on file with the Fund will receive a quarterly statement. If you prefer, you may opt out of receiving a paper copy of your quarterly statement and view it instead on our Internet Home Page over a secured connection. These statements indicate how your investment portfolio performed over the preceding quarter. In order to opt out of receiving your quarterly statement through the U.S. mail, you must first access your statement on our web site. There is a button you need to mark that indicates that you wish to view all future statements electronically; from that point forward, you will be able to view your statements electronically in lieu of receiving a paper copy through the U.S. mail.
Important things to know about Quarterly Statements:
- Members will receive the following components in their Quarterly Statements
- Statement reflecting member information
- Reallocation form for use in selecting or changing investment portfolio strategy
- Investment rate summary sheet
- Members who do not keep their address current will not receive paper Quarterly Statements through the mail. However, you will still be able to access your statement on-line.
- The Quarterly Statements contain an unaudited and unofficial record of a member's service credit. Service credit eligible for computing a retirement benefit will be determined officially only at retirement based on properly verified service and applicable laws in effect at the time.
- The interest rate for the Guaranteed Fund is established on an annual basis by the Fund's Board of Trustees.
- The salary listed on the Quarterly Statement is for the period running from July 1 through the last day of the preceding quarter. These figures do not necessarily match the teacher's contract salary, which generally covers a different period.
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