Section 60.53. Death benefits — automatic distributions.

 

(1)  

(a) A beneficiary of a deceased annuitant who is entitled to a continuation of the annuitant's monthly annuity under s. 40.73 (2) , Stats., may receive the benefit as a monthly annuity by filing a timely application. The application for a monthly annuity must be received by the department no later than the last day of the third full calendar month which begins after the date the department mails or otherwise provides the application to the beneficiary.

(b) If the department does not receive an application for a continuation of the monthly annuity within the deadline specified in sub. (1) the department shall pay the then present value of the death benefit to the beneficiary as a lump sum. The department may not accept a request to cancel the lump sum payment which is received after the deadline specified in sub. (1) or the deadline specified in s. ETF 60.51 (2) , whichever is earlier.

(c) If the beneficiary submits a waiver of a lump sum benefit under s. 40.74 (2) , Stats., and the department receives it on or before the deadline specified in s. ETF 60.51 (2) , the department shall defer automatic distribution of the benefit during the waiting period before the waiver effective date. Any new beneficiary who becomes eligible for a continuation of the monthly payments as a result of a waiver shall be granted the period specified in sub. (1) to apply for continuation of the monthly payments.

(2)  

(a) This subsection applies to death benefits payable from required or additional contribution accumulations that the department had not begun to distribute before the death of the participant or alternate payee.

(b) The department shall treat a distribution paid as a lump sum under s. 40.25 (2) , Stats., as having begun prior to the death of the participant or alternate payee if the date of the check is on or before the date of death. The department shall treat a distribution paid as an annuity or as a lump sum in lieu of an annuity under s. 40.25 (1) or (4) , Stats., as having begun prior to the death of the participant or alternate payee if all of the following apply:

1. The participant or alternate payee is living on the date the department receives the benefit application and on the effective date of the benefit;

2. The department does not receive the participant's or alternate payee's written request to cancel the benefit as provided under s. ETF 20.20 (4) on or before the date of death.

(c) A beneficiary may elect to receive a death benefit payable under this subsection as a monthly annuity, subject to s. 40.73 (3) , Stats., provided the beneficiary applies, and the department receives the application, no later than the close of business on the last working day of September in the calendar year following the year of the participant's or alternate payee's death. The annuity effective date may not be later than November 1 of that year.

(d) A beneficiary may elect to receive the death benefit as a lump sum provided the beneficiary applies, and the department receives the application, no later than the close of business on the last working day of September in the fifth calendar year following the year of the participant's or alternate payee's death.

(e)

1. A beneficiary who was the spouse of the deceased participant at the time of death may defer application for the death benefit until the latest of the following dates:

a. For an application for a monthly annuity, the application date specified in par. (c) ;

b. For an application for a lump sum, the application date specified in par. (d) ;

c. For an application for any optional form of payment, the last working day of the year in which the participant would have attained age 69.5. The department may not accept an application for a monthly annuity under this subdivision if the department receives the application after the application date specified in par. (c) , unless the beneficiary files a beneficiary designation that the department receives by that date or by September 30, 1999, whichever is later.

2. This paragraph does not apply to spouses of deceased alternate payees.

(f) During the calendar year that the participant would have attained age 69.5, a beneficiary who was the spouse of the participant at the time of death and who has filed a beneficiary designation if required under par. (e) 1. c. , may apply for a death benefit with a deferred effective date which may not be later than January 1 of the year in which the participant would have attained age 70.5.

(g) Unless the account is considered abandoned as provided in s. 40.08 (8) (a) 2. or 2m. , Stats., the department shall distribute the death benefit as a lump sum unless it has received an application for the death benefit within the applicable deadline specified in par. (d) or (e) . If the application was due under par. (d) or (e) 1. b. , the department shall make the distribution on or before the last working day of the fifth calendar year following the year of the death of the participant or alternate payee. If the application was due under par. (e) 1. c. , the department shall make the distribution effective January 1 of the year in which the participant would have attained age 70.5. Beneficiaries may not cancel distributions made under this paragraph.

(h) The department may not accept a waiver of a benefit under s. 40.74 (2) , Stats., for a benefit payable under this subsection if the effective date of the waiver is on or after the application deadline specified in par. (d) . If a beneficiary becomes eligible for a benefit under this subsection as a result of a waiver, the department shall base the new beneficiary's deadlines to apply for the benefit on the participant's or alternate payee's date of death.

(i) Except as provided in s. 40.23 (4) (e) 4. , Stats., if a beneficiary becomes eligible for a death benefit under this subsection as a result of the death of a beneficiary, the department shall base the new beneficiary's deadlines to apply for the benefit on the participant's or alternate payee's date of death.

Cr. Register, December, 1996, No. 492 , eff. 1-1-97; renum. (1) to (3) to (1) (a) to (c), cr. (2), Register, May, 1997, No. 497 , eff. 6-1-97; correction in (2) (b) (intro.) made under s. 13.93 (2m) (b) 7., Stats., Register, July, 1999, No. 523 ; CR 09-057 : am. (1) (c) Register May 2010 No. 653 , eff. 6-1-10.

Note

This rule ( CR 09-057 ) amends ss. ETF 20.07 (6) and 60.53 (1) (c) to conform to the new effective date for waivers in s. 40.08 (3) , Stats., as affected by 2007 Wis. Act 131 . Microsoft Windows NT 6.1.7601 Service Pack 1