SB449,14,823 40.23 (1) (b) All retirement annuities shall be effective on the day following, or
24on the first day of a month following, the date of separation from the last
25participating employer by which the participant was employed, as specified by the

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1participant in the written application for the annuity. However, the date shall not
2be more than 90 days prior to the date of receipt of the application by the department.
3The participant may specify that additional contribution accumulations shall not be
4applied to provide an annuity until a subsequent application is filed for an annuity
5to be paid from the additional contribution accumulations. The subsequent
6application shall be made as specified under sub. (4) or the department shall
7automatically distribute the accumulated additional contribution accumulations as
8a lump sum.

SB449,14,1510 40.23 (1) (c) No application specifying an annuity effective date later than 60
11days after the date of its receipt by the department shall be accepted , unless the
12participant files the application on or after January 1 of the calendar year in which
13the participant attains the age of 69.5 years specifying an annuity effective date that
14begins before April 1 of the year following the calendar year in which the participant
15attains the age of 70.5 years.

SB449,14,2217 40.23 (1) (d) Notwithstanding par. (c), an application for an annuity to be
18effective on the day following termination of employment may be filed up to 90 days
19prior to the employe's anticipated termination date. The anticipated termination
20date shall be stated in the application and the department shall not make an annuity
21payment until the employe has terminated. The department shall reject any
22application that is filed more than 90 days prior to the employe's termination date.

SB449,15,1224 40.23 (2m) (b) Except as provided in s. 40.26, subject to the limitations under
25section 415 of the internal revenue code, as defined for the current taxable year under

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1s. 71.01 (6), the initial amount of the normal form annuity shall be an amount equal
2to 65%, or 85% for participants whose formula rate is determined under par. (e) 4.,
3of the participant's final average earnings plus the amount which can be provided
4under pars. (c) and (d) or, if less, shall be in the monthly amount equal to the sum
5of the amounts determined under pars. (c), (d) and (e) as modified by par. (f) and in
6accordance with the actuarial tables in effect on the annuity effective date. If the
7participant has creditable service under both par. (e) 4. and another category under
8par. (e), the percent applied under this paragraph shall be determined by multiplying
9the percent that each type of creditable service is of the participant's total creditable
10service by 85% and 65%, respectively, and adding the results, except that the
11resulting benefit may not be less than the amount of the normal form annuity that
12could be paid based solely on the creditable service under par. (e) 4.

SB449,15,2014 40.23 (4) (a) Subject to all requirements under the internal revenue code, the
15department shall distribute to the participant the entire amount that is credited to
16the account of a participant under the Wisconsin retirement system no later than the
17required beginning date, unless the department distributes this amount as an
18annuity or in more than one payment. If the department distributes this amount as
19an annuity or in more than one payment, the department shall begin the distribution
20no later than the required beginning date.

SB449,16,221 (b) In the calendar year immediately preceding the calendar year of a
22participant's required beginning date, if the department distributes the amount that
23is credited to the account of a participant under the Wisconsin retirement system in
24a form other than as a lump sum payment, the department, subject to all

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1requirements under the internal revenue code, shall calculate the distribution to the
2participant according to one of the following:

SB449,16,43 1. The life of a participant or, if the annuity is in the form of a joint and survivor
4annuity, the joint lives of the participant and the named survivor.

SB449,16,85 2. For an annuity authorized under s. 40.24 (1) (f), a term certain not to exceed
6the life expectancy of the participant or, if the annuity is in the form of a joint and
7survivor annuity, the joint life expectancies of the participant and the named
8survivor.

SB449,16,219 (c) If a participant during the calendar year in which he or she attains 69.5
10years, or the alternate payee during the calendar year in which the participant
11attains 69.5 years, does not apply before December 31 in that year for a distribution
12of the amount that is credited to the account of a participant under the Wisconsin
13retirement system, the department shall begin, effective the following January 1, an
14automatic distribution to the participant or alternate payee. If the department
15makes an automatic distribution under this paragraph, the beneficiary designation
16filed with the department before the date on which the department begins the
17automatic distribution is no longer applicable under ss. 40.71 and 40.73. Unless the
18participant or alternate payee files a subsequent beneficiary designation with the
19department after the date on which the department begins the automatic
20distribution, the department shall pay any death benefit as provided under s. 40.02
21(8) (a) 2.

SB449,17,422 (d) If a participant dies after the department begins to distribute the amount
23that is credited to the account of a participant under the Wisconsin retirement
24system, but before the entire amount in the account has been distributed, the
25department shall distribute the remaining portion of the account at least as rapidly

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1as is provided in the manner of distribution selected by the participant. If the
2beneficiary does not apply to the department to continue the distribution, within a
3period specified by rule, the department shall pay the remaining distribution to the
4beneficiary as a lump sum.

SB449,17,155 (e) If a participant dies before the distribution of benefits has commenced and
6the participant's beneficiary is the spouse, the department shall begin the
7distribution within 5 years after the date of the participant's death. If the spouse files
8a subsequent beneficiary designation with the department, the payment of the
9distribution may be deferred until the January 1 of the year in which the participant
10would have attained the age of 70.5 years. If the spouse does not apply for a
11distribution, the distribution shall begin as an automatic distribution as provided
12under par. (c). If the spouse dies, but has designated a new beneficiary, the birth date
13of the spouse shall be used for the purposes of determining the required beginning
14date. The department shall specify by rule all procedures relating to an automatic
15distribution to the spouse. These rules shall comply with the internal revenue code.

SB449,17,1816 (f) If a participant dies before the distribution of benefits has commenced and
17the participant's beneficiary is not the spouse, the beneficiary shall do one of the
18following:

SB449,17,2019 1. Elect a lump sum payment by December 31 of the 5th calendar year after the
20date of the participant's death.

SB449,17,2221 2. Elect an annuity benefit, not to exceed his or her life expectancy, by December
2231 of the calendar year after the date of the participant's death.

SB449,17,2523 (g) Nothing in this subsection shall be construed to create any benefit, lump
24sum payment option or form of annuity not otherwise expressly provided for in this
25subchapter.

SB449,18,142 40.24 (1) (f) From accumulated additional contributions made under s. 40.05
3(1) (a) 5. only, an annuity certain payable for and terminating after the number of
4months specified by the applicant, regardless of whether the applicant dies before or
5after the number of months specified, provided that the monthly amount of the
6annuity certain is at least equal to the minimum amount established under s. 40.25
7(1) (a). The Subject to the period of distribution required under s. 40.23 (4) (b) 2., the
8number of months specified shall not exceed 180 and shall not be less than 24. If the
9death of the annuitant occurs prior to the expiration of the certain period, the
10remaining payments shall be made in accordance with s. 40.73 (2) without regard to
11any other annuity payments payable to the beneficiary. An annuity under this
12paragraph may be initiated prior to any other annuity amount provided under this
13subchapter and prior to age 55 if all other qualifications for receiving an annuity
14payment are met.

SB449,18,2016 40.24 (5) An annuity in a form other than the normal form shall be the actuarial
17equivalent of the annuity in the normal form if, on the effective date of the annuity,
18the annuity has the same single-sum present value as the annuity in the normal
19form, as calculated by the department according to methods and assumptions
20specified by the actuary.

SB449,18,2222 40.24 (7) (a) 6. Automatic distributions under s. 40.23 (4).

SB449,19,624 40.25 (6) (a) 2. Applications for reestablishment of creditable service must
25include all creditable service that has been forfeited except that the number of years

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1which may be reestablished under this subsection may not be greater than the
2creditable service of the participating employe at the date of application, or 10 years,
3whichever is smaller. The department may, by rule, permit a participating employe
4to reestablish creditable service by making payments under subd. 3. over a period
5of more than one year to prevent exceeding the maximum contribution limits under
6section 415 of the internal revenue code.

SB449,19,248 40.25 (6) (a) 3. The participating employe applying for forfeited creditable
9service under this subsection shall pay to the fund an amount equal to the employe's
10statutory contribution on earnings under s. 40.05 (1) (a) for each year of forfeited
11service to be reestablished, based upon the participating employe's final average
12earnings, determined as if the employe retired on the date the department receives
13the application. Beginning on the date specified by the department, but not earlier
14than April 23, 1992, and not later than January 1, 1993, the participating employe
15may elect to use part or all of his or her accumulated additional contributions made
16under s. 40.05 (1) (a) 5. to pay part or all of the amount payable under this
17subdivision. The amount payable under this subdivision shall be paid in a lump sum
18payment. A participating employe who elects to use accumulated additional
19contributions as provided in this subdivision may terminate that election only if,
20within 30 days after the date on which the department receives the participating
21employe's application for forfeited creditable service, the participating employe
22submits to the department a written notice to terminate that election. No employer
23may pay any amount payable under this subdivision on behalf of any participating
24employe.

SB449,20,3

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140.25 (6) (a) 5. The payment under subd. 3., in combination with any other
2required contributions or additional contributions, may not exceed the maximum
3contribution limit under section 415 of the internal revenue code.

SB449,20,75 40.25 (7) (a) 1. The participant files an application to receive creditable service
6under this paragraph not more than 90 days after before termination of employment
7as a participating employe.

SB449,20,1710 40.26 (1) Except as provided in ss. 40.05 (2) (g) 2. and 40.23 (1) (am), if a
11participant receiving a retirement annuity, or a disability annuitant who has
12attained his or her normal retirement date, receives earnings that are subject to s.
1340.05 (1) or that would be subject to s. 40.05 (1) except for the exclusion specified in
14s. 40.22 (2) (L), the annuity shall be terminated and no annuity payment shall be
15payable after the month in which all of the following apply: the participant files with
16the department a written election to be included within the provisions of the
17Wisconsin retirement system as a participating employe.

SB449,21,221 40.26 (3) (bm) (intro.) If a former annuitant receives earnings at or above the
22level specified under sub. (1) for becomes a participating employe and accumulates
23at least 3 continuous years of creditable service before subsequent retirement and
24application for an annuity under this subsection, and if changes in the statutes after
25the effective date of the original annuity would result in a change in the amount of

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1an annuity recomputed under this subsection, the annuity of the former annuitant
2shall be recomputed as follows:

SB449,21,74 40.26 (5) If a participant applies for an annuity or lump sum payment during
5the period in which less than 30 days have elapsed between the termination of
6employment with a participating employer and becoming a participating employe
7with any participating employer, all of the following shall apply:

SB449,21,88 (a) The participant shall not qualify for an annuity under s. 40.23 (1) (a) 1.

SB449,21,109 (b) The participant may not receive any benefit under this chapter on which the
10receipt of an annuity is a condition.

SB449,21,1911 (c) Any annuity or lump sum payment made to the participant shall be
12considered to have been made in error and is subject to s. 40.08 (4). The sum of the
13payments made in error shall be credited to a memorandum account. The
14memorandum account is subject to s. 40.04 (4) (a) 2. and 2m. and (c). If the annuity
15was recomputed under s. 40.08 (1m), the memorandum account established under
16this paragraph shall be adjusted pursuant to s. 40.08 (1m) (f) 2. The retirement
17account of a participant paid in error, and whose annuity was terminated, shall be
18reestablished as if the terminated annuity had never been effective, including the
19crediting of interest.

SB449,21,2521 40.27 (2) (b) Different Prorated percentages based on the annuity effective date
22may be applied to annuities with different effective dates as may be determined to
23be equitable during the calendar year preceding the effective date of the distribution,
24as provided by rule, but no other distinction may be made among the various types
25of annuities payable from the fixed annuity reserve.

SB449,22,6 240.31 Maximum benefit limitations. (1) General limitation. (a)
3Limitation amounts. Except as otherwise expressly provided in this section and
4section 415 of the internal revenue code, the maximum retirement benefits payable
5to a participant in a calendar year, excluding benefits attributable to contributions
6subject to any limitations under s. 40.23, may not exceed the lesser of the following:

SB449,22,107 1. For a straight-life annuity terminating at the death of the annuitant,
8$120,000. If the annuity is in a form other than a straight-life annuity, the limitation
9is the reduced actuarial equivalent of a straight-life annuity terminating at the
10death of the annuitant and paying $120,000 per year.

SB449,22,1311 2. One hundred percent of the participant's average annual earnings for the
12period of up to 3 consecutive calendar years during which the person was a
13participating employe and which yield the highest average annual earnings.

SB449,22,2014 (b) Early commencement. If the participant's benefit commencement date
15occurs before the date on which the participant attains the age of 62, the dollar
16limitation under par. (a) shall be the actuarial equivalent of the dollar limitation of
17an annual straight life annuity beginning at the age of 62 and terminating at the
18death of the annuitant. For the purposes of this paragraph, the interest rate
19assumption that is used to determine the actuarial equivalency may not exceed 5%.
20Under this subsection, the dollar limitation shall be:

SB449,22,2121 1. Not less than $75,000 if the benefit commences at or after the age of 55.

SB449,22,2222 2. Equal to $75,000 if the benefit commences before the age of 55.

SB449,23,223 3. Not less than $50,000 for participants who have at least 15 years of service
24as a full-time employe of any police or fire department which is organized and
25operated by the employer to provide police protection, fire fighting services or

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1emergency medical services for any geographic area within the jurisdiction of the
2employer.

SB449,23,83 (c) Deferred commencement. If the participant's benefit commencement date
4occurs after the date on which the participant attains the age of 65, the dollar
5limitation under par. (a) shall be the actuarial equivalent of the dollar limitation of
6an annual straight life annuity beginning at the age of 65 and terminating at the
7death of the annuitant. For the purposes of this paragraph, the interest rate
8assumption that is used to determine the actuarial equivalency may not exceed 5%.

SB449,23,129 (d) Limitation adjustments. The dollar limitations under pars. (a) 1. and (b)
10and the compensation limit under par. (a) 2. may be increased by the department by
11rule to conform with any applicable U.S. treasury regulations concerning
12cost-of-living adjustments.

SB449,23,15 13(2) Exceptions to general limitation. Benefits payable to a participant shall
14be considered not to exceed any limitation under this section if one of the following
15applies:

SB449,23,2016 (a) The amount of the benefit does not exceed the total benefits of the
17participant under all of the qualified defined benefit plans maintained or previously
18maintained by all of a participant's employers, as determined by the department
19without regard to any amendment to any of the benefit plans made after October 14,
201987.

SB449,23,2321 (b) The amount of the benefit does not exceed $10,000 for the plan year and
22none of the participant's employers have at any time maintained a defined
23contribution plan in which the participant participated.

SB449,24,7 24(3) Treatment of defined benefit and defined contribution plans. For the
25purpose of determining whether a participant's retirement benefits exceed the

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1maximum retirement limitations under this section, all defined benefit plans of the
2employer, including defined benefit plans that are terminated, shall be treated as a
3single defined benefit plan and all defined contribution plans of the employer,
4including defined contribution plans that are terminated, shall be treated as a single
5defined contribution plan. The department may provide by rule additional
6limitations for participants who are participating in more than one retirement
7system.

SB449,24,12 8(4) Division of benefits. For the purpose of determining whether a
9participant's retirement benefits exceed the maximum retirement limitations under
10this section for a participant whose retirement benefits have been divided under s.
1140.08 (1m), the participant's retirement benefits shall be measured as if no division
12had occurred.

SB449,24,16 13(5) Rules. The department may by rule adjust the maximum benefit
14limitations under this section to conform with the internal revenue code and any
15regulations promulgated by the U.S. secretary of the treasury, including an
16adjustment which eliminates the maximum benefit limitations under this section.

SB449,24,23 1840.32 Limitations on contributions. (1) The sum of all contributions
19allocated to a participant's account under each defined contribution plan sponsored
20by the employer, including all employer contributions and picked-up contributions
21credited with interest at the effective rate under s. 40.04 (4) (a) and (5) (b) and all
22employe contributions made under ss. 40.02 (17), 40.05 (1) and (2m) and 40.25 (6) (a),
23may not in any calendar year exceed the lesser of the following:

SB449,24,2424 (a) Thirty thousand dollars.

SB449,25,2

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1(b) Twenty-five percent of the participant's compensation, as defined in the
2internal revenue code, for the calendar year.

SB449,25,43(c) The maximum contribution limit under section 415 (c) of the internal
4revenue code.

SB449,25,6 5(2) The department may provide by rule additional limitations for participants
6who are participating in more than one retirement system.

SB449,25,13 7(3) Any contribution that the department receives, which is allocated to the
8account of a participant and which exceeds the contributions limitation under this
9section, may be refunded or credited as provided in s. 40.08 (6). If the department
10refunds any contributions that exceed the limitation under this section, the
11department shall first refund amounts voluntarily contributed by a participating
12employe, either as an additional contribution under s. 40.05 (1) (a) 5. or a purchase
13of forfeited or creditable service under s. 40.02 (17) or 40.25 (6) (a).

SB449,25,1915 40.73 (3) (a) A death benefit may be paid as a beneficiary an annuity for the
16life of the beneficiary, if the amount of the death benefit is sufficient to provide a
17beneficiary annuity in the normal form at least equal to the amount determined
18under s. 40.25 (1) (a) and the beneficiary or the participant has elected to have the
19death benefit paid as a beneficiary annuity.

SB449,25,2421 40.73 (3) (e) Any beneficiary who is eligible to receive a beneficiary annuity
22may elect to receive the annuity in any of the optional annuity forms provided for
23retirement annuities, other than an annuity under s. 40.24 (1) (c) or any annuity
24payable over the joint life expectancies of the beneficiary and another person.

SB449,26,5

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140.86 Covered expenses. (intro.) An employe-funded reimbursement
2account plan may provide reimbursement to an employe for only the following
3expenses that are actually incurred and paid by an employe and that the board
4determines are consistent with the applicable requirements of the internal revenue
5code, as defined in s. 71.01 (6):

SB449,26,77 111.91 (2) (k) The definition of earnings under s. 40.02 (22).

SB449,26,99 111.91 (2) (L) The maximum benefit limitations under s. 40.31.

SB449,26,1111 111.91 (2) (m) The limitations on contributions under s. 40.32.