Defined Contribution Plan
Defined Contribution Plan Benefit Summaries
The normal form of benefit for a married participant is the Joint and 50% Survivor Annuity which pays a lifetime benefit to you and a 50% lifetime benefit to your spouse when you die. Optionally, you can choose a form which pays the surviving spouse 100% of the benefit you were receiving. This form may require the purchase of an annuity from an insurance company at current market rates. In practice, most participants choose one of the optional forms of benefit shown below. All forms of benefit other than the normal form require the notarized consent of your spouse, if you are married.
This is the normal form of benefit if you are not married. It pays a monthly lifetime benefit.
Defined contribution plan benefits are most commonly withdrawn in a lump sum. Bear in mind that there are tax consequences to your withdrawal of your accumulated benefit. Any withdrawal from the plan is treated as ordinary income for tax purposes. Taking a lump sum directly may increase your income tax bracket and increase the amount you will subsequently owe to the IRS and state tax authorities. You can also roll over the proceeds of the withdrawal to an IRA or certain other forms of tax-advantaged retirement plans. If you roll your money over directly to an IRA, there are no immediate tax consequences.
Joint and 50%, 75%, or 100% Survivor Annuity
These options are also available for non-married participants.