Boilermakers Local Lodge No. 5 Annuity Fund
Local 5 Annuity Fund - 2014 Annual Report
Local 5 Annuity Fund - Annuity Distribution Form
Local 5 Annuity Fund - Loan Application Form
Local 5 Annuity Fund - Direct Rollover Form
What is the Annuity Fund?
The Annuity Fund is a negotiated contractual arrangement that is designed to accumulate employer contributions on your behalf, to be paid out to you as a retirement benefit when you leave the work force.
You are eligible to participate in the Boilermakers Local Lodge No. 5 Annuity Plan if:
· You work in a job that is covered by a collective bargaining agreement with the International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers, and Helpers of America, AFL-CIO, Local Lodge No. 5 (Local 5) requiring contributions to be made to Boilermakers Local Lodge No. 5 Annuity Fund (Annuity Fund);
· You are an officer, business agent, or employee of the Union, and the Union contributes to the Annuity Fund on your behalf, as employers contribute on behalf of employees working a full workweek; or
· You are an employee of the Board of Trustees of the Boilermakers Local Lodge No. 5 Annuity, Vacation and Welfare Funds.
Your participation in the Annuity Plan starts as soon as you complete at least one hour in a job:
· That is covered by a collective bargaining agreement that requires contributions to the Annuity Fund with the Boilermakers Local Lodge No. 5;
· As an employee of the Union; or
· As an employee of the Board of Trustees of the Boilermakers Local Lodge No. 5 Annuity, Vacation and Welfare Funds.
Your employer makes contributions to your Individual Account during each Plan Year (January 1 - December 31) while the collective bargaining agreement is in effect.
Your employer(s) makes contributions to the Plan in accordance with its collective bargaining agreement with the International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers, and Helpers of America, AFL-CIO, Local Lodge No. 5 or other agreement with the Board of Trustees requiring contributions.
You should name a beneficiary. You will need to complete a beneficiary designation form naming a beneficiary to receive the value of your Individual Account in the event of your death. You may name more than one beneficiary.
You can obtain a beneficiary designation form from the Fund Office and you must file the completed form with the Fund Office either in person or by mail. You may change your beneficiary designation at any time by completing a new beneficiary designation form, unless as explained below, you’re married or your distribution has begun.
Your spouse (if you have been married for at least one year at the time of your death) is automatically your beneficiary until the first day of the calendar year in which you turn age 35. If your spouse consents to an additional or different beneficiary, such consent expires on the first day of the calendar year in which you turn age 35. At such time, a new spousal consent must be obtained to name an additional or different beneficiary.
On the first day of the calendar year in which you turn age 35, your spouse is automatically your beneficiary and will remain so unless your spouse consents to an additional or different beneficiary. Spousal consents, or the lack thereof, can present complicated issues in both pre-retirement and retirement situations. If you have any questions, you should contact the Fund Office.
To name an additional or different beneficiary for any portion of your Individual Account, you and your spouse must complete and sign a spousal consent form which can be obtained from the Fund Office. The completed form must then be filed with the Fund Office to be effective.
If you are not married and you have not designated a beneficiary(ies), or your beneficiary(ies) does not survive you, the beneficiary of your Boilermakers Local Lodge No. 5 Welfare Fund life insurance coverage will receive your Annuity Plan distribution.
If you are covered by the Local Lodge No. 5 Welfare Fund and you have not designated a life insurance beneficiary, or that person has pre-deceased you, then the balance in your Individual Account will be distributed to your estate.
If you are not covered by the Local Lodge No. 5 Welfare Fund, then the balance in your Individual Account will be distributed to your estate.
What is my Individual Account?
An Individual Account is established in your name when contributions to the Fund are first made on your behalf.
Your employer makes contributions based upon the applicable collective bargaining agreement or other agreement setting forth the contributions to be made on your behalf. These contributions are then credited to your Individual Account.
Vesting refers to your guaranteed right to receive a benefit from the Plan. You are immediately 100% vested in the money in your Individual Account.
You are eligible to receive benefits under the Annuity Plan when you:
· Become separated from service, which means that no contributions have been made or were supposed to be made to the Fund on your behalf for six consecutive months;
· Are totally and permanently disabled (see the section called “What happens if I become disabled?” on page 17 for details); or
· Have shown satisfactory evidence to the Board of Trustees that you have retired and are receiving an award from the Boilermakers Blacksmiths National Pension Trust.
Your benefit payments cannot be delayed beyond April 1 of the calendar year after the calendar year in which you turn age
70½.
The amount of your benefit is valued daily based on the closing prices of the mutual fund shares in your Individual Account.
You will receive quarterly statements summarizing the investment activity in the most recent quarter and showing allocable administrative expenses deducted from that account.
If you are eligible to receive a benefit, you may choose to begin to have your benefit distributed to you (also known as a distribution) as early as the first day of the month after you retire, or are separated from service (if you are under age 55). To be separated from service means that no contributions have been or were supposed to be made to the Fund on your behalf for at least six months.
See “What happens if I become disabled?” on page 17 for a description of when your benefit will begin if you are totally and permanently disabled.
You are not required to take a distribution until the April 1st following the year in which you attain age 70½. In order to obtain a benefit, you must submit a completed application for a benefit to the Fund Office.
This Plan accepts rollovers of your retirement funds from certain other plans that are qualified under the Internal Revenue Code. To process a rollover to the Plan, you must complete the appropriate rollover forms, which are available from the Fund Office.
Your rollover will be put in a separate sub-account of your Individual Account, called your Rollover Account. If you have a Rollover Account:
· You will be fully vested in it; and
· You direct how the money in your Rollover Account is to be invested. You can invest it in the Putnam investment options, described on page 10, along with the balance of your Individual Account.
To be eligible, any rollover to this Plan must meet the following conditions:
· The rollover must be a lump sum distribution from another qualified plan which is eligible for tax-free rollover to a qualified plan;
· You can roll over only the eligible taxable portion of the distribution; and
· The rollover must meet the necessary Internal Revenue Service (IRS) requirements—for example that it is paid to this Plan within 60 days of your receipt or that the check is made payable directly to this Plan instead of you.
If you had previously rolled over your balance in any other employer’s tax-qualified plan into an Individual Retirement Account (IRA) you can roll over the funds in that IRA into this Plan if it was a separate IRA established solely for tax-qualified employer plan rollovers. You must roll over the full distribution from the IRA and must do so within 60 days of receiving the distribution from the IRA.
If the IRA contains funds (other than earnings) from any source other than rollover(s) from qualified employer plans, IRS rules say that you can’t make a further rollover to this Plan.
Can I borrow money from my account?
You can borrow from your Individual Account. You are eligible for a loan if you have had an Individual Account for a 36 consecutive month period and you have not retired.
There are rules that limit the amount you can borrow from your Individual Account:
· In general, you can borrow up to the lesser of:
¾$50,000; or
¾50% of the value of your Individual Account.
· The minimum loan allowed is $2,000.
Outstanding loan balances will reduce the amount available that you can borrow.
You can only request a loan for one or more of the following reasons:
· You or one of your eligible dependents has medical expenses, resulting from a sickness or injury, which the Boilermakers National Health and Welfare Fund doesn’t cover;
· You have funeral expenses due to the death of your spouse, child, or parent;
· You, your spouse, or your dependent child has tuition and/or room and board expenses at an educational institution beyond the high school level;
· You purchase a home, condominium, or cooperative apartment, and incur down payment, contract, or title expenses (please note that a loan for this purpose will only be made once);
· You have contracted to have an addition built to your residence;
· You have been involuntarily unemployed for at least 60 consecutive days; or
· You have purchased and now own an automobile (please note that a loan for this purpose will only be granted once every three calendar years).
· Your loan will bear simple interest at the prime rate, as published in the Wall Street Journal as of the first day of the calendar year in which the loan is granted. During the course of the loan, the interest rate you will pay will be the same as the rate when your loan was first approved.
To obtain a loan application, please contact the Fund Office. Once you submit your application, the Board of Trustees will review your application and make a determination on your loan request.
Even though you are borrowing from your own account, you are required, by law, to repay your loan. At the very minimum, you must pay off your loan in monthly installments, and entirely repay the loan within five years from the date the loan is granted.
You can prepay your loan balance at any time without penalty and you will only be charged interest through the month in which the loan is completely repaid.
If you miss a loan payment your loan will be considered in default. You will receive a Form 1099 and the amount of your loan may be subject to IRS penalties for early withdrawal, including a 10% excise tax on the defaulted amount. Your account will be reduced by the amount you borrowed (principal) but have not yet repaid plus accrued interest on all remaining payments.
There are two things to keep in mind when you take out a loan from your Individual Account:
· When you take out a loan, the loan proceeds are paid out to you, and are no longer invested in any of the Prudential mutual funds. Your loan repayments when made, including the interest you pay, go back into your account.
· Upon your retirement, if you have not completely repaid your loan, your Individual Account balance will be reduced by any outstanding loans.
Yes. When you first participate, you choose how the amount in your Individual Account is invested among the Prudential Financial investment funds in increments of 5%. You can change your account investments daily.
Rapid Trading violations are subject to redemption fees of up to 2%. See each funds prospectus or call Prudential at 1-877-778-2100 for details on redemption fees associated with individual funds.
Your investment options are mutual funds, all of which purchase a variety of stocks, bonds, or money market instruments that are consistent with each mutual fund’s investment objectives.
For specific information about each Prudential investment fund, please refer to a copy of that fund’s prospectus. If you need one, please contact Prudential at 1-(877) 778-2100 or on the world wide web at www.prudential.com/online/retirement
It’s up to you to determine the “investment mix” of your Individual Account. The Fund Office cannot and will not give you investment advice. You should consult with your own financial advisor with respect to how your Individual Account is, or should be, invested.
The Boilermakers Local Lodge No. 5 Annuity Plan intends to satisfy the provisions of Internal Revenue Code section 404(c). This means that the Board of Trustees will not be held liable for any losses that your Individual Account experiences as a result of your own investment decisions.
While Internal Revenue Code section 404(c) limits the Board of Trustees’ liability for your personal investment decisions, the Board of Trustees is still responsible for prudently choosing and monitoring the Plan’s range of investment alternatives, and for administering in accordance with your own investment decisions. The Board of Trustees has the right to change, add, or delete, at any time, the investment funds that the Plan offers.
DEFAULT INVESTMENT FUND:
If you do not make investment elections for all or any part of the money in your Individual Account, any money you have not elected to otherwise invest will be invested in Manning & Napier Pro-Blend Moderate Term Fund.
If you completely withdraw from any employment covered by a collective bargaining agreement between your contributing employer(s) and Local 5, your contributing employer(s) will stop making contributions to the Annuity Fund on your behalf.
When you can receive a distribution from your Individual Account depends on certain factors (see “When does my benefit begin?” on page 7 for details). The rest of this section will explain how you access the money in your Individual Account.
To apply for a benefit, you must complete an application form from the Fund Office.
When you receive a distribution from your Individual Account, you must report it as taxable income. You will receive Form 1099R. The Fund Office is required to send a copy of this to the Internal Revenue Service. Any portion of your distribution paid in cash will be taxable in the year in which you receive it and may be subject to a 10% penalty tax for early distribution. You may be able to defer the payment of taxes by directly “rolling over” or transferring the total distribution to an Individual Retirement Account (IRA) or other qualified retirement plan. You will receive information explaining the tax withholding rules when you apply for a distribution.
To best understand the tax consequences of a distribution you receive, it’s a good idea to discuss your particular circumstances with your financial advisor or accountant before applying for the benefit.
Yes. You or your spouse may be able to continue deferring taxes on a taxable distribution through a “rollover.” A rollover lets you transfer your otherwise taxable Plan distributions into another qualified retirement plan or into an Individual Retirement Account (IRA) that you or your spouse has established. You have 60 days from the time of distribution to roll over all or some of your account balance.
Your distribution is limited to the amount in your Individual Account at the time you retire. However, you should be aware that there are certain maximum limits established by the Internal Revenue Service on the level of contributions that can be made on your behalf by your employer.
If you’re single and you file for a distribution of your Individual Account when you leave employment, your benefit will be paid as a Single Lifetime Annuity unless you elect an optional payment method. The Single Lifetime Annuity provides a fixed monthly benefit to you for the rest of your life. No further payments will be made to a beneficiary after your death.
If you’re married and you file for a distribution from your Individual Account, the Plan’s automatic payment method is the Husband and Wife Annuity, unless you elect an optional payment method. The Husband and Wife Annuity provides you with a reduced, fixed monthly benefit for the rest of your life. After your death, if your spouse survives you, he or she will continue to receive 50% of your benefit until his or her death. If your spouse pre-deceases you, all monthly payments of your Annuity Plan benefit will end with your death.
The amount of your monthly payment will be determined by converting the value of your Individual Account (as defined on page 6) into a fixed monthly annuity payment purchased through an insurance company.
You can choose to have your Individual Account paid to you by one of these optional payment methods, instead of the automatic form of payment:
· Equal Monthly Installments, paid to you until your account balance is exhausted.
· Lump Sum Payment; or
· A combination of the two above options.
You have 90 days to select an optional payment method before your first payment is scheduled. If you are married, in order to elect one of the Plan’s optional payment methods, you must have your spouse’s written, notarized consent.
Unless your spouse has consented to your naming someone else as your designated beneficiary, your surviving spouse can elect to receive your benefit under the same payment options available to you.
Your surviving spouse may apply for your benefit at any time after your death, but he or she must begin receiving payments from your Annuity Plan benefit upon the later of the following:
· December 1 of the calendar year in which you, the participant, would have turned age 70½; or
· December 1 of the calendar year following the year of your death.
If you die after your Annuity Plan benefit begins, your spouse or designated beneficiary will receive the survivor portion of your benefit, if any.
If you become “totally and permanently disabled”, you will be eligible to receive a benefit from the Annuity Plan.
Totally and permanently disabled means… |
|
You are permanently unable to work as a boilermaker in the boilermaking industry. |
What happens if I leave and am rehired?
If you leave before you attain the Normal Retirement Age (the later of age 65 or your fifth anniversary of Plan participation), when you return to covered employment, your employer will make contributions on your behalf to either:
· Your existing Individual Account if you haven’t depleted it; or
· To a new, second Individual Account, which will be opened in your name. Once you retire for the second time, you will be able to access those contributions and investment earnings. Please note that you will not be eligible to begin receiving an Annuity Plan distribution while you are actively employed as a Local 5 Boilermaker. However, you may continue to receive previously applied for installment payments from your existing Annuity Fund Account during the period of your reemployment.
Federal law requires that if the Annuity Plan becomes a “top-heavy” plan, as described in the Internal Revenue Code, minimum contributions may apply. Multi-employer plans, such as this, are generally not top-heavy, as defined by the Internal Revenue Code. In the unlikely event that this Annuity Plan becomes top-heavy, you will be notified accordingly.
The Board of Trustees has the right to amend or terminate this Plan when required by law or when it deems appropriate. The Plan may be amended at any time if the Trustees agree to do so in writing, as long as the amendment does not reduce any participant’s benefit.
Should the Plan be terminated, participants will remain 100% vested in their account balances. The remaining Plan assets, after payment of Plan expenses and previously approved distributions, will be distributed among the participants.
No. Your Plan benefit cannot be assigned, transferred, sold, or pledged for any reason prior to distribution. They are also exempt from execution, attachment, garnishment, bankruptcy, and claims for alimony maintenance and child support (except as provided in a Qualified Domestic Relations Order (QDRO) and certain other orders) prior to distribution. For information on QDROs, please turn to page 24.
The Internal Revenue Service (IRS) requires the Annuity Plan to place limitations on the maximum employer contributions made on your behalf.
These limitations are necessary in order for the Annuity Plan to qualify for favorable tax treatment. In the unlikely event that the employer contributions made on your behalf have reached their limit, the Fund Office will contact you with more information.
Yes. In order to make benefit determinations and administer the Plan, the Board of Trustees may request certain information or proof from any Plan participant, annuitant, or beneficiary. Your Plan benefit may be denied, suspended, or discontinued if you:
· Fail to provide the Board of Trustees with the information or proof it requests either promptly or in good faith; or
· Provide fraudulent information or proof.
No. The Annuity Plan is a defined contribution plan, and such plans are not insured by the Pension Benefit Guarantee Corporation (PBGC).
If you do not receive a benefit to which you believe you are entitled, you should file a claim in writing with the Board of Trustees. Once the Board of Trustees receives your claim, they will generally make a decision about it at their next regularly scheduled meeting. However, if your request is received less than 30 days before the meeting, the decision may be postponed to the second meeting following your request.
If special circumstances require an extension of time for processing (for example, the Board of Trustees needs more information, such as an audit of contributions), a decision may be made at the third meeting following the date the request for a review was made.
The Board of Trustees’ decision will be in writing and will include the specific reason(s) for the decision and specific references to Plan provisions on which the decision is based. If you request a review of a denied claim, you will be notified of the approximate date that you can expect to receive a decision.
You have the right to appeal a denial. You may submit a written appeal to the Fund Office within 90 days after you receive the claim denial notice. You and your representative may review pertinent documents to your claim and submit written comments and relevant information. The Board of Trustees will respond to the appeal with a decision within 90 days after acknowledgment of the receipt of the appeal and all requested and submitted information in support of the appeal.
Boilermakers Local Lodge No. 5 Annuity Fund
13-6106830
001
Defined contribution plan, specifically an annuity plan
January 1 - December 31
Board of Trustees
Boilermakers Local Lodge No. 5
24 Van Siclen Ave.
Floral Park, NY 11001
(516) 326-2500
(718) 895-7722
Barnes, Iaccarino & Shepherd LLP
3 Surrey Lane
Hempstead, NY 11550
Marshall & Moss Administrative Services
1400 Old Country Road, Suite 406
Westbury, NY 11590
P (516) 333-9010
F (516) 333-9039
All contributions to the Fund are made by contributing employers according to the terms of the collective bargaining agreement or other agreement with the Board of Trustees in effect. You are not allowed to make contributions to the Plan. A list of contributing employers is available from the Fund Office.
Contact the Fund Office in writing if you want to know whether a particular employer contributes to the Plan on behalf of participants working under the collective bargaining agreement.
The Fund’s assets and reserves are held in trust by Prudential Financial Investments and/or Merrill Lynch Cash Management Accounts.
The Annuity Fund is administered by a joint Board of Trustees composed of two union representatives and two employer representatives. The Board of Trustees is an administrator who employs and staffs the Fund Administrative Office. The Board of Trustees has delegated the regular operations of administering the Fund to an employed administrator.
You can request, in writing, to receive a copy of the collective bargaining agreement related to the Plan. Write to:
Boilermakers Local Lodge No. 5
24 Van Siclen Ave.
Floral Park, NY 11001
The Board of Trustees has the full authority to interpret the Plan and its provisions. However, the Fund Administrator and the Fund Office are responsible for answering all day-to-day questions concerning eligibility, benefit, and claims procedures.
The Plan does not create a contract of employment, or any promises regarding employment. It is not meant to interpret, extend or change the provisions of the Plan in any way. The Board of Trustees expects to continue the Plan, but reserves the right to amend, modify or discontinue all or part of this program whenever conditions so warrant.
A Qualified Domestic Relations Order (QDRO) is a court order or judgment directing the Plan to pay all or a portion of your Plan benefit to a spouse, former spouse, child, or other dependent for the purpose of providing alimony, maintenance and child support, or determining marital property rights, among other things.
Your Rights under the Employee Retirement Income Security Act (ERISA)
The Employee Retirement Income Security Act (ERISA), passed by Congress in 1974, gives you certain basic rights as a participant in this benefit plan. These rights apply to all plans, including yours. By law, you are entitled to:
· Examine all Plan documents without charge at the Plan Administrator’s office. These include insurance contracts, detailed annual reports, and Plan descriptions.
· Get copies of all Plan documents and other Plan information upon written request to the Plan Administrator. The Plan Administrator may make a reasonable charge for the copies.
· Receive a summary of the Plan’s annual financial report. The Plan Administrator is required by law to furnish each participant with a copy of this summary annual report.
In addition to outlining your rights as a Plan participant, ERISA imposes duties upon the people who are responsible for the administration of the Plan. The people who administer the Plan are called “fiduciaries.” They have a duty to do so prudently and in the interest of you and other Plan participants and beneficiaries. No one, including your employer, or any other person, may discriminate against you in any way to prevent you from obtaining a benefit or exercising your rights under ERISA. If your claim for a benefit is denied in whole or in part, you must receive a written explanation of the reason for denial. You have the right to have the Plan reviewed and your claim reconsidered.
Under ERISA, there are steps you can take to enforce the above rights. For instance, if you request materials from the Plan and do not receive them within 30 days, you may file suit in a Federal court. In such a case, the court may require the Plan Administrator to provide the materials and pay up to $110 a day until you receive the materials, unless the materials were not sent because of reasons beyond the control of the Plan Administrator.
If you have a claim for a benefit which is denied or ignored, in whole or in part, you may file suit in a state or Federal court. If it should happen that Plan fiduciaries misuse the Plan’s money, or if you are discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor, or you may file suit in a Federal court. The court will decide who should pay court costs and legal fees.
If the court decides in your favor, the court may order the person you have sued to pay these costs and fees. If the court decides against you (for example, if it feels your claim is frivolous), the court may order you to pay these costs and fees.
If you have any questions about the Plan, you should contact the Plan Administrator. If you have any questions about this statement or about your rights under ERISA, you should contact the nearest Office of Pension and Welfare Benefits Administration (PWBA), U.S. Department of Labor, listed in your telephone directory. You also may contact the Division of Technical Assistance and Inquiries, Pension and Welfare Benefits Administration, U.S. Department of Labor, 200 Constitution Avenue, N.W., Washington, D.C. 20210. You also may telephone a PWBA advisor in Washington, DC at (202) 219-8776 or visit the PWBA’s Internet site at www.dol.gov/dol/pwba.