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A spouse, former spouse, child or other dependent of a participant who, according to a Domestic Relations Order, is entitled to receive all or a portion of the benefits payable under a plan with respect to the participant.
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| A stream of periodic payments that continue
based on the lifetime of either the participant or the alternate payee over a
fixed period of time. |
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| A person designated by a participant or an
alternate payee who, by the terms of the plan, may be eligible for benefits
under the plan, if the participant or the alternate payee dies with all or a
portion of the account or benefit remaining. |
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| Cost of living adjustments are increases to the
amount of the pension benefit. The adjustment to the benefit is a way for a
retirement plan to account for inflation related changes in the participants’
purchasing power during retirement.
However, such adjustments are not guaranteed, and are only implemented in accordance with the specific defined benefit plan, if applicable. The amount and frequency of cost of living adjustments, if any, are determined at the plan’s discretion. |
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| A plan that is designed to provide participants
with a specific benefit, usually for a period of years after retirement. The final benefit payable under the plan is
determined by the plan benefit formula, and is characteristically based on
factors such as credited service and compensation earned. In contrast to typical defined contribution
plans, the employer has the entire investment at risk, and must cover any
funding shortfall. |
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| A plan that provides an individual account for
each participant. Individual defined
contribution accounts are funded by participant and/or employer contributions depending
on the type of plan. Allocated income,
expenses, gains, and/or losses affect the value of the account. |
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| A judgment, decree or order, including a court
approved property settlement agreement, which relates to the provision of child
support, alimony payments or marital property rights for the benefit of a
spouse, former spouse, child or other dependent of a plan participant, and
which is made pursuant to a state domestic relations law (including a community
property law). A Domestic Relations
Order becomes a “QDRO” when it is determined by the Plan Administrator to have
met qualification requirements in accordance with The Employee Retirement Income Security Act of 1974, as amended, and The
Internal Revenue Code of 1986, as amended. |
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| When a participant retires before normal
retirement age with a benefit in a defined benefit plan, the amount of the
retirement benefit is actuarially reduced to account for the fact that it will
be paid over a longer period of time.
If a participant retires prior to normal retirement age and the plan
does not apply a full actuarial reduction in the amount of benefit that
is paid to the participant, the amount by which the benefit has not been
actuarially reduced is called an early retirement subsidy. A participant who receives an early
retirement subsidy receives a greater total benefit than the participant would
have received if the benefit were paid with a full actuarial reduction. |
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The result of investment experience in a defined contribution
account. This amount may include
dividends, interest, gains and/or losses, as calculated in accordance with the
plan’s procedures. Earnings impact the
net value of the account, as distinct from contributions.
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| The Federal statute
governing employee benefit plans. ERISA incorporates applicable Internal Revenue Code provisions
and labor law provisions. Its focus is
to protect the rights of participants in and beneficiaries of employee benefit
plans. ERISA imposes various
qualification requirements and fiduciary responsibilities on welfare benefit
and retirement plans, as well as enforcement procedures. |
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| The Internal Revenue Code of 1986, as amended. |
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| An annuity paid for the life of the Participant
with a survivor annuity for his or her spouse.
The survivor annuity must be at least 50% but not more than 100% of the
annuity received by the participant during his or her lifetime. |
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A court’s power to decide a case or issue a decree over the subject
matter, the parties’ rights, and the type of relief sought.
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| A marital property fraction can be used to signify
the portion of a participant’s total accrued vested benefit which was acquired
during the marriage. This concept is
primarily applicable to defined benefit plans, and is most useful when the
years of participation in a given retirement plan do not coincide closely with
the years of the marriage. A marital
property fraction generally has a numerator reflecting the participant’s months
of credited service earned during the marriage, and a denominator reflecting the
participant’s total months of credited service. |
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An employee or
former employee of the Plan sponsor for whom a benefit under a qualified plan
is maintained. It is the Participant's
benefit that is divided in a QDRO.
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| The individual or entity designated by the plan
and responsible for the control and management of contributions to the
qualified plan, whether exercised directly or through a designated agent or
trustee. |
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| The entity that establishes and maintains the qualified retirement plan. |
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| Any judgment, decree or order (including a court
approved property settlement agreement) issued under state domestic relations
law, and which relates to the payment of child support, alimony or marital
property rights. A QDRO recognizes an
alternate payee’s right to receive plan benefits otherwise payable to a
participant. |
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| A form of
benefit that provides regular periodic payments to the Participant, and on the
Participant’s death, provides payments to the surviving spouse in the form of a
survivor annuity for the remainder of the survivor’s lifetime. |
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| A payment made to the
surviving spouse of a vested participant who was married and died before
commencing his or her own benefit under the plan. If applicable, a QPSA must be provided whether or not the
participant separated from service before death. |
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| A federal income tax deferred transfer of cash
or other assets from a qualified retirement plan or an eligible IRA to another
eligible retirement plan. |
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| Amounts that would be payable to an alternate
payee under the terms of the domestic relations order, following qualification
of the order. |
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| A method of defining the division of the
participant’s retirement benefit into two separate portions, giving the
alternate payee a separate right to receive the awarded portion of the
retirement benefit at a different time and in a different form from that chosen
by the participant. A separate interest
approach may not be used if the participant has already started to receive the
retirement benefit to be divided. |
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| Approach used to split each actual benefit
payment made under a retirement plan.
This gives the alternate payee a portion of each payment as it is
otherwise made to the Participant.
Under this approach the alternate payee will not receive any payments
unless the participant receives a payment. |
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| A document that the plan administrator is
required to furnish to each participant and beneficiary receiving benefits that
summarizes their rights and benefits along with the obligations of the plan. |
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| When a stock fund is unitized, a participant’s
balance in the fund is expressed in “unitized shares” or “units” instead of
shares per se. Unitized funds operate
similarly to a mutual fund, in that they are composed of stock, and a small
percentage of cash or another short-term interest-bearing vehicle. The inclusion of cash provides liquid assets
to allow for the daily processing of transfers, loans and withdrawals. The value of a unit in a unitized stock fund
is based on the Net Asset Value (NAV), which is the value of the underlying
common stock and the cash piece held by the fund, divided by the number of
units outstanding. Therefore, the NAV
of the fund (the “unit price”) will, as a rule, be different from the closing
price of the underlying stock on the applicable exchange. |
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| The date as of which benefits
are measured or calculated, in order to calculate an alternate payee’s award
amount pursuant to a Qualified Domestic Relations Order. In certain defined contribution plan
scenarios, the valuation date is also the start date for calculating earnings
on an award. Normally, contributions, loans, withdrawals, compensation and
service increases in the Participant’s account or benefit after the valuation
date will not be included in the calculation of the alternate payee’s award. |
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| Accrued benefits of a participant which have
become non-forfeitable under the vesting schedule adopted by the plan. |
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