Distribution Options When Separating From Service
Upon separation of service, notification from your employer — either voluntary, by retirement, or otherwise — you may be eligible to receive payment from your State of Missouri Deferred Compensation Plan account. In the event of your death, your beneficiary will receive payment.
You have several choices regarding the money in your Plan account. Before making a request for a distribution, the State of Missouri Deferred Compensation Plan suggests that you check with your Financial or Tax Advisor.
- Keeping Money in the Plan
You may keep the entire balance in the Plan until age 70½, at which time you must do one of the following (please see the Distribution Options Guide in the Publications section):
- take required minimum distribution payments
- take a lump-sum distribution
- Payment Options
You can select one of the following options:
- Lump Sum — You can elect to receive a one-time distribution for the entire amount of the available portion of your account balance.
- Lump Sum with Rollover* — You can elect to roll over all, or a portion of your distribution to another qualified plan or IRA.
- Partial Lump Sum — You can receive a portion of your funds in any amount at any time.
- Rollover — You can elect to roll over the balance of your account to another qualified plan or IRA.
- Installments — You can choose Installment payments on a frequency of your choice (must be made at least annually).
- Defer Payment — You must elect to receive payment before April 1 after you turn age 70½. If you are age 70½ or older, your payments must meet the required minimum distribution. For more information, please see the Distribution Options Guide, located in the Publications section.
- Transfer to an Annuity — You may elect to transfer up to 100% of the monies to an annuity. Learn more about the ICMA-RC Income for Life Annuity Program (PDF).
Requests for distributions from the Plan can be made online in Account Access in the Withdraw Funds section under the My Account tab, through the Plan’s Information Line (800-392-0925), or through the local Plan office. Distribution choices and rules can be complicated. You are encouraged to talk with your tax adviser or financial planner before deciding how to take a distribution.
Note: Periodic payments of ten years or more are not eligible for rollover.
* You can elect to have your distribution rolled over to a qualified plan, such as a 401(a) plan, 403(b) plan, 457 plan, or to an IRA (if the plan accepts rollover money from other plans). If you elect a direct rollover, you will owe federal income taxes when you begin taking distributions in the years they are paid to you by the IRA or other plan. Prior to rolling money over, you may want to confirm with the plan receiving the money of any changes that may effect the distribution options of the rolled-in money. If you do not elect a direct rollover, 20% of your distribution(s) from the Plan will be withheld for federal taxes. Further, to the extent that you roll over money to a non-457 plan, you should review whether a 10% early withdrawal tax penalty will apply.