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NAPO has been working with the Treasury Department, Members of Congress and members of the pension community on Treasury regulations and the enactment of Normal Retirement Age rules. Earlier this year NAPO met with key policy makers within the Treasury Department to present the concerns of rank-and-file law enforcement on the pending implications of the proposed January 1, 2013 enactment of Normal Retirement Age guidelines.
This morning Treasury released updated guidance making modifications to the 2007 regulations. These changes are an important step in the right direction for NAPO’s members.
First, the “safe harbor” provision that allows public safety to qualify for “Early Unreduced Retirement” will now encompass pension plans that are combined with other plans. Therefore, officers will no longer be forced to wait longer to retire and receive benefits. NAPO has worked closely with the offices of Senator Kohl, Representative Pascrell, Representative Kind and Representative Duffy to address this specific issue. We would like to thank them for their hard work and leadership.
Secondly, this notification clarifies in-service distributions for public safety. As long as an individual is participating in a plan and is older than 62, they are entitled to collect in-service distribution. We are aware that this does not solve all the problems with this issue and will continue to seek a legislative fix.
Finally, and most importantly, for the immediate future, the enactment date for the IRS Normal Retirement Age has once again been postponed. The new date of enactment has been moved to January 1, 2015.
NAPO will continue to seek a full exemption for public safety from the Normal Retirement Age and will work to raise awareness of the issues of HELPS Benefits. (If an officer retired under “Early Unreduced Retirement” then they do not qualify for HELPS Benefits. Under the HELPS provision, a public safety officer must have retired at “Normal Retirement Age” in order to obtain the privilege to use up to $3,000 from their retirement savings on a pre-tax basis for use toward health care insurance and long-term care insurance premiums.)
Treasury has requested comments regarding the guidance under consideration described in the notice, “Application of the Normal Retirement Age Requirements to Governmental Plans”. NAPO will be submitting written comments soon and we will send a copy of our letter and a sample letter for your department to submit. Please do not hesitate to contact me via email (firstname.lastname@example.org) or phone (703-549-0775) if you have any questions or concerns.