Section 2 AAC 37.015 - Bona fide termination of employment(a) For the purposes of this chapter, a bona fide termination of employment is considered valid only if there is no prearrangement between the member and the employer for continued employment in any capacity after the retirement effective date. If any prearrangement to return to work with the same employer exists before retirement, the member will be deemed to not have a bona fide termination of employment and the member's retirement shall be void. (b) Unless (f) of this section applies, for purposes of a bona fide termination of employment, the following breaks - in - service requirements shall apply:(1) a member under age 62 at the time of retirement cannot return to employment in any capacity with the same employer until six months have elapsed from the date of retirement;(2) a member age 62 or older cannot return to employment with the same employer until 60 days have elapsed from the date of retirement.(c) If a retired member under age 59¹/² returns to employment with the same employer with less than a six - month break in service, benefit payments shall not be made during the period of reemployment. All benefit payments received before the date of cessation of payments and occurring while the member was under age 59¹/² will be coded, under Internal Revenue Service requirements, as an early distribution (no known exception) for tax purposes unless another known exception exists. Upon the member's subsequent termination from employment, a member's entitlement to benefit payments will commence the day after the date of the termination. The member will again be required to establish a bona fide termination in accordance with (b) of this section before reemploying again with the same employer. (d) If a retired member over age 59¹/², but less than age 62, returns to employment with the same employer with less than a six - month break in service, benefit payments shall not be made during the period of reemployment. Upon the member's subsequent termination from employment a member's entitlement to benefit payments will commence the day after the date of the termination. The member will again be required to establish a bona fide termination in accordance with (b) of this section before reemploying again with the same employer.(e) If a retired member age 62 or older returns to employment with the same employer with less than a 60-day break in service, benefit payments shall not be made during the period of reemployment. Upon the member's subsequent termination from employment, a member's entitlement to benefit payments will commence the day after the date of the termination. The member will again be required to establish a bona fide termination in accordance with (b) of this section before reemploying again with the same employer.(f) Regardless of age, retired members who have a prearrangement for reemployment in existence with the same employer before the member's retirement will be deemed to not have a valid termination from employment and shall be ineligible for retirement benefits during the period of reemployment. The member will be required to repay to the plan all retirement and health benefits received from the plan plus applicable interest. Interest will be at the plan rate and is effective as of the date of the member's appointment to retirement. Any amounts not repaid to the plan shall continue to accrue interest and shall be subject to collection from the member's retirement benefit. Based upon the voided retirement, during the continued employment, the member will be treated as having not retired for purposes of benefit accrual and shall be subject to all plan provisions for active members.Eff. 12/22/2017,Register 225, April 2018Authority:AS 22.25.010
AS 22.25.020
AS 22.25.025
AS 22.25.027