Northwest Carpenters Individual Account Pension Plan

Retirement Payment Options 

Under normal, early and disability retirement, your benefit amount is the vested combined balance of your five subaccounts on the later of your retirement effective date or on your distribution date(s). No benefit reduction is made for early retirement under this plan. Any non-periodic payment from this plan of less than ten years is subject to a 20 percent mandatory federal income tax withholding unless it is rolled over to an Individual Retirement Account (IRA) or eligible retirement plan.

There are a variety of payment options available when you retire under this plan. Each of these payment options is described below. Your retirement benefits under this plan are taxable income.

For additional information about the benefit amount available under normal and early retirement, please see Article 4.1.

Lump Sum Distribution

You receive a one-time, lump sum payment of your account balance. You may elect to rollover all or part of the lump sum. If your account balance is $5,000 or less, benefits will be paid in this form. This is the standard form of payment for a participant whose only contributions are for hours worked on or after January 1, 2014.

For additional information about a lump sum distribution, please see Article 4.4.

Partial Distribution

You receive a portion of your total vested account balance at retirement and defer receipt of the balance (including any investment earnings or losses) to a later tax year. You may elect a different payment option for the balance of your account. Each partial distribution is subject to the application and election procedures. If you die before the second payment is made, your designated beneficiary receives the second payment.

For additional information about a partial distribution, please see Article 4.3(c).

Period Certain Payments

You receive benefits over a specified number of months. The amount is fixed, essentially equal monthly payments (subject to adjustment for earnings and losses in the plan). You elect the number of months over which the payments will be made, however, the payment period cannot exceed the joint life expectancy of you and your beneficiary. If you die before receiving all payments, payments will continue to your beneficiary. If you elect a payment period that is less than ten years, payments may be rolled over to an Individual Retirement Account (IRA) or an eligible retirement plan. You must designate your spouse as beneficiary unless your spouse consents to your designation of another beneficiary.

For additional information about period certain payments, please see Article 4.3(a).

Amount Certain Payments

You receive a specified dollar amount until your account is depleted. The dollar amount cannot generate an income that exceeds the joint life expectancy of you and your beneficiary. If you die before receiving all payments, payments will continue to your beneficiary. You must designate your spouse as beneficiary unless your spouse consents to your designation of another beneficiary.

For additional information about period certain payments, please see Article 4.3(a).

Minimum Annual Payout

You receive a specified dollar amount each month until you exhaust your account balance. You designate the monthly amount of the payout. The amount will be adjusted annually to account for investment gains or losses. If you die before receiving all payments, payments continue to your beneficiary. You must designate your spouse as beneficiary unless your spouse consents to your designation of another beneficiary. You may also receive a specified monthly benefit based on your account balance divided by your life expectancy. The amount is adjusted annually to account for investment gains or losses. If you die before receiving all payments, payments continue to your beneficiary. You must designate your spouse as beneficiary unless your spouse consents to your designation of another beneficiary.

For additional information about a minimum annual payout, please see Article 4.3(b).

Deferred Distribution

You may defer your distribution from this plan to a later date. On your future distribution date, you may elect any one of the distribution options. During the deferral period, your account balance continues to experience investment earnings and losses.

Lifetime Annuity Income

If contributions were made to the plan for work before January 1, 2014, you may elect to have the Board of Trustees purchase, on your behalf, a non-transferable annuity. You may elect to have your benefit paid to you as a lifetime monthly income. The amount of your monthly benefit is based on your vested account balance on your retirement effective date as well as other parameters (including your age and life expectancy and the interest rate) assumed by the insurance company providing the annuity. Annuities are not available to retirees whose first contributions to the plan are attributable to work beginning January 1, 2014 and later.

Two annuity options are available depending on your marital status when you retire.

Qualified Joint and Survivor Annuity

The standard form of payment for the married participant with contributions in the plan for work performed before January 1, 2014, is a joint and survivor annuity. This annuity provides a monthly benefit for your life and, if you die before your spouse, 50% of that amount for the remainder of your spouse’s life. Your annuity income is based on your vested account balance on your retirement effective date.

For additional information about a qualified joint and survivor annuity, please see Article 4.2(c).

Single Life Annuity

The standard form of payment for the single participant with contributions in the plan for work performed before January 1, 2014, is a single life annuity. This annuity provides a monthly income for your life. Your annuity income is based on your account balance on your retirement effective date.

For additional information about a single life annuity, please see Article 4.2(b).

Annuity payments are provided through purchase of an annuity contract from an insurer with the proceeds of your account. Please contact the Milliman Service Center for assistance with the two annuity income options.

Last Updated: 04/25/2023