Northwest Carpenters Individual Account Pension Plan

Article 4: Payment of Retirement Benefits: Normal, Early, Disability 

4.1 Amount of Benefit

When a Participant becomes eligible to receive retirement benefits, the Participant is entitled to the vested amount in his Individual Account, as established by the most recent Valuation Date, plus any Employer Contributions credited to the vested portion of the Individual Account since the last Valuation Date, and adjusted for changes in the market value which occurred since the last Valuation Date. Notwithstanding the foregoing, no market value adjustment is made for the month preceding the month in which benefits commence, even if the most recent Valuation Date falls within that month. Benefits shall be paid only under one of the forms of payment below.

4.2 Default Annuity Forms of Payment

If a portion of the Participant's Individual Account is attributable to contributions for hours worked prior to January 1, 2014, the Participant's entire Individual Account shall be paid as follows:

  1. Qualified Joint and Survivor Annuity. The standard form of payment for a Participant who is legally married on his retirement date is a qualified joint and survivor annuity which is an annuity for the life of the Participant with a survivor annuity for the life of the Participant's spouse which is equal to fifty percent (50%) of the amount of the annuity payable during their joint lives. The amount of the annuity shall be determined using the Participant's vested Individual Account balance. The Trustees may purchase a non-transferable annuity from a commercial insurance company and distribute this annuity to the Participant. The Trustees shall hold title to the annuity in a form which will prohibit its surrender or a change of its method of payment, without the consent of the Participant's spouse. In lieu of this standard form, the Participant with the consent of his spouse, may elect another form of payment provided by the Plan.
  2. Single Life Annuity. The standard form of payment for a Participant who is not married on his retirement date is a single life annuity for the life of the Participant. A Participant who is married on his retirement date may, with the consent of his spouse, waive the standard form of payment for married Participants and elect a single life annuity. The amount of the annuity shall be determined using the Participant's vested Individual Account balance. The Trustees may purchase a non-transferable annuity from a commercial insurance company and distribute this annuity to the Participant. The Trustees shall hold title to the annuity in a form which will prohibit its surrender or a change of its method of payment, without the consent of the Participant's spouse.
  3. Qualified Optional Survivor Annuity. A Participant who is legally married on his retirement date may, with the consent of his spouse, waive the standard form of payment and elect a qualified optional survivor annuity, which is an annuity for the life of the Participant with a survivor annuity for the life of the Participant's spouse which is equal to seventy-five percent (75%) of the amount of the annuity payable during their joint lives. The amount of the annuity shall be determined using the Participant's vested Individual Account balance. The Trustees may purchase a non-transferable annuity from a commercial insurance company and distribute this annuity to the Participant. The Trustees shall hold title to the annuity in a form which will prohibit its surrender or a change of its method of payment, without the consent of the Participant's spouse.

4.3 Non-Annuity Optional Forms Of Payment

In lieu of the standard forms of payment described in Article 4.2 (applicable to Participants with Covered Service before January 1, 2014) and Article 4.4 (applicable to Participants with no Covered Service before January 1, 2014), a Participant, with the consent of his spouse, if any, may waive the standard form of payment and elect one of the following optional forms of payments.

  1. Period Certain Payments. The period certain payments are fixed and essentially equal monthly payments, payable to the Participant, and upon death, to the surviving spouse, surviving children or any other designated beneficiary, provided, however, a beneficiary designation of someone other than the surviving spouse will not be effective unless the surviving spouse has agreed in writing to the designation. The period shall be selected by the Participant, but shall not exceed the joint life expectancy of the Participant and the Participant's spouse, if any. If benefits have commenced at the time of the Participant's death, they shall be distributed over a period not to exceed the period of distribution in effect prior to the Participant's death.
  2. Minimum Annual Payout. A Participant who retires after December 31, 1990, may elect a minimum annual payout, paid monthly, until exhaustion of the Participant's vested Individual Account balance. If the Participant dies prior to exhaustion of the vested Individual Account balance, benefits will be continued to the surviving spouse, surviving children or any other designated beneficiary, provided, however, a beneficiary designation of someone other than the surviving spouse will not be effective unless the surviving spouse has agreed in writing to the designation. The amount of the payout shall be selected by the Participant, using the Participant's vested Individual Account balance and adjusted annually as of the last day of the Plan Year to account for investment gains or losses to the Participant's vested Individual Account. The minimum annual payout shall be not less than the minimum required distribution under Internal Revenue Code § 401(a)(9).
  3. Partial Withdrawal. A Participant may elect to receive a portion of his vested Individual Account at retirement and defer receipt of the balance. Distributions must be made in accordance with the required minimum distribution provisions. A Participant may elect a different form of payment for receipt of the balance of his Individual Account, provided that he may not elect the pension enhancement option. Each partial withdrawal is subject to the application and election procedures, including spousal consent.

4.4 Lump Sum Payment

  1. A participant may receive the entire vested Individual Account balance at retirement, or in the first January following retirement. This is the standard form of payment for a Participant who has no contributions attributable to Covered Service prior to January 1, 2014.
  2. Notwithstanding any provision in this Plan to the contrary, if the amount in the Participant's Individual Account (less the balance of his Rollover Account) is $5,000 or less, the Plan shall pay his entire Individual Account in a lump sum cash payment.
  3. A participant who elects or receives a lump sum payment under subsection (a) or (b) above, may request transfer of all or part of his vested Individual Account to the Northwest Carpenters Retirement Plan pursuant to Article 10.6.

4.5 Application and Payment Of Retirement Benefits

  1. Application
    1. To receive any retirement benefits under this Plan, a Participant must submit a written application to the Trustees indicating the benefit applied for and providing any necessary proof of eligibility in accordance with this Plan. Application under this Plan must be made on the same date as application under the Carpenters Retirement Plan, if applicable, although the distribution under this Plan may be deferred to a later date, if requested by the Participant.
    2. Upon application for retirement benefits, a Participant shall receive a written explanation from the Trustees of the terms and conditions of the various forms of payment. In no event will benefits commence prior to seven days after the Participant receives this written explanation. For purposes of electing a form of payment, or revoking an election, each Participant shall have an election period of 90 days commencing with the date the written explanation has been provided to the Participant. The election, or revocation of an election, must be in writing and filed with the Trustees before expiration of the election period. The Annuity Starting Date is the first day of the first period for which an amount is payable as an annuity, or in the case of a benefit not payable in the form of any annuity, the first day on which all events have occurred which entitle the Participant to such benefit.
    3. If the Participant's Account is over $5,000, election of a form of payment, other than the Qualified Joint and Survivor Annuity or Qualified Optional Survivor Annuity for a Participant with Contributions for Covered Service prior to January 1, 2014, must be consented to by the Participant's spouse during the election period. The consent will designate a beneficiary which cannot be changed. The consent will acknowledge the effect of the election and be witnessed by a Plan representative or a notary public. Notwithstanding this consent requirement, if the Participant establishes to the satisfaction of the Trustees that such written consent cannot be obtained because there is no spouse or the spouse cannot be located, or for any other reason provided by the Secretary of the Treasury or his delegate, such election can be made without the consent of any person.
  2. Commencement Date. Unless the Participant elects otherwise, payment of Normal Retirement benefits shall commence not later than the sixtieth (60th) day after the close of the Plan Year in which the latest of the following events occur:
    1. The Participant's application is received by the Trust;
    2. The Participant attains the Early or Normal Retirement Date; or
    3. The Participant has terminated employment with all Individual Employers that make contributions to the Plan.
    Notwithstanding any provision to the contrary, commencement of benefits may not be postponed to a date later than the "required beginning date." For calendar years beginning after 1996, the "required beginning date" of a Participant is the later of:
    1. April 1 of the calendar year following the calendar year in which the Participant attains age 70½; or
    2. The calendar year in which the Participant retires, if the Participant is not a five-percent (5%) owner.
    Any Participant, except a five-percent (5%) owner, attaining age 70½ in years after 1995 may elect by April 1 of the calendar year following the year in which the Participant attains age 70½ (or by December 31, 1997 in the case of a Participant attaining age 70½ in 1996) to defer distributions until the calendar year following the calendar year in which the Participant retires. If no such election is made, the participant will begin receiving distributions by April 1 of the calendar year following the year in which the Participant attains age 70½ (or by December 31, 1997 in the case of a Participant attaining age 70½ in 1996). The determination of whether a Participant is a five-percent (5%) owner will be made in accordance with Internal Revenue Code § 416. This Article shall be construed in accordance with Internal Revenue Code Section 401(a)(9) and regulations promulgated thereunder, all of which are hereby incorporated by reference.
  3. Retroactive Payment. If an application for benefits, for which a Participant was otherwise eligible, was not made for reasons beyond the Participant's control, the Trustees may make payments retroactive in whole or in part to a date preceding the application for benefits but subsequent to the month in which the Participant became eligible for the benefit. Payment of Normal Retirement benefits must be made retroactive if necessary to comply with subparagraph (b) above.
  4. Lost Participant/Beneficiary. If a Participant has not submitted an application for retirement benefits as of the "required beginning date" as defined by Article 4.5(b), and the Plan is unable to locate the Participant, the Participant's accrued benefits shall be forfeited effective one year from the Participant's "required beginning date." If retirement benefits are payable to a Participant's beneficiary under Article 4 or Article 5, and the Plan is unable to locate the beneficiary, such benefits shall be forfeited effective one year from the date benefits first became payable to the beneficiary. Notwithstanding the foregoing, previously forfeited benefits of a Participant or beneficiary shall be reinstated upon written application of the Participant or beneficiary. The amount to be reinstated shall be equal to the balance of the Individual Account on the date of the forfeiture, adjusted for income gains or losses since the date of forfeiture.

4.6 Legal Disabilities – Facility Of Payment

If, in the opinion of the Trustees, any Participant who is eligible to receive payments under this Plan is legally, physically, or mentally incapable of personally receiving and receipting for any such payment, the Trustees may direct payments to such other person, persons, or institutions, who, in the opinion of the Trustees, are then maintaining or have custody of such Participant, until claim is made by a duly appointed guardian or other legal representative of such Participant. Such payments, to the extent thereof, will constitute a full discharge of the liability of the Fund and of the Trustees under the Plan.

4.7 Effect of Returning to Work

In the event a Participant who has elected Early or Normal Retirement under this Plan returns to work, payment of benefits under this Plan will not be suspended. This provision shall have no effect on the rules under the Carpenters Retirement Plan, which provides for an early retirement reduction factor on election of early retirement and for suspension of benefits. Benefits earned after retirement will be paid within 60 days after the close of the Plan Year in which the benefits were earned.

A Participant who has elected Disability Retirement and who returns to work covered by a Collective Bargaining Agreement, is governed by Article 2.9.

Last Updated: 12/02/2022