Board Resolution 2013-04-07

WHEREAS, section 7-198 of the Illinois Pension Code authorizes the Board of Trustees of the Illinois Municipal Retirement Fund (IMRF) to establish rules necessary or desirable for the efficient administration of the Fund; and

WHEREAS, section 1-118 of the Pension Code provides that IMRF will comply with the provisions of the federal Heroes Earnings Assistance and Relief Tax of 2008 (P.L. 110-245); and

WHEREAS, it is necessary to adopt rules for the efficient administration of section 1-118.

THEREFORE BE IT RESOLVED that the following administrative rule be and is hereby adopted by the Board of Trustees:

Rule on Military Service

1.Compliance with Code Section 414(u) for Reemployed Veterans

Effective December 12, 1994, pursuant to 40 ILCS 5/1-118 and, notwithstanding any other provision of the Pension Code, contributions, benefits and service credit with respect to qualified military service are governed by section 414(u) of the Internal Revenue Code and the Uniformed Services Employment and Reemployment Rights Act of 1994.

2.Compliance with Code Section 401(a)(37) and the HEART Act

Effective with respect to deaths occurring on or after January 1, 2007, while a member is performing qualified military service (as defined in chapter 43 of title 38, United States Code), to the extent required by section 401(a)(37) of the Internal Revenue Code, survivors of an IMRF member are entitled to any additional benefits that the system would provide if the member had resumed employment and then died, such as accelerated vesting or survivor benefits that are contingent on the member's death while employed. In any event, a deceased member's period of qualified military service must be counted for vesting purposes.

Effective with respect to deaths occurring on or after January 1, 2007, while a member is performing qualified military service (as defined in chapter 43 of title 38, United States Code), to the extent permitted by section 414(u)(9) of the Internal Revenue Code, for benefit accrual and vesting purposes, the member will be treated as having earned years of service for the period of qualified military service, having returned to employment on the day before the death, and then having terminated on the day of death. This provision shall be applied to all similarly situated individuals in a reasonably equivalent manner.

Beginning January 1, 2009, to the extent required by section 414(u)(12) of the Internal Revenue Code, an individual receiving differential wage payments (as defined under section 3401(h)(2) of the Internal Revenue Code) from an employer shall be treated as employed by that employer, and the differential wage payment shall be treated as compensation for purposes of applying the limits on annual additions under section 415(c) of the Internal Revenue Code. This provision shall be applied to all similarly situated individuals in a reasonably equivalent manner.