It's important to know your options when it comes to annuities. If you're considering surrendering your Horace Mann annuity, make sure you understand the implications of doing so. The Horace Mann annuity surrender form outlines the procedures and terms associated with giving up your contract. Read on to learn more about the process involved in surrendering your annuity, and what to expect if you choose to go through with it.
Here's some information that will help you learn just how long it takes to finish the horace mann annuity surrender form.
| Question | Answer |
|---|---|
| Form Name | Horace Mann Annuity Surrender Form |
| Form Length | 13 pages |
| Fillable? | No |
| Fillable fields | 0 |
| Avg. time to fill out | 3 min 15 sec |
| Other names | horace mann surrender forms, horace mann transfer exchange or direct rollover to another company form, horace mann life insurance transfer exchange or rollover form, horace mann forms |
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Horace Mann Life Insurance Company
P.O. Box 4657
Springfield, IL
Fax
SUR ANCHGRPOC
Annuity surrender/withdrawal request (not for hardship withdrawal or direct
rollover transactions - see attached tax notice)
A.Your instructions
Your request can be made by mail or by fax, however, if your request is received by fax and is for an amount of $250,000 or more, our office will contact you by phone to verify the request.
Please read this form carefully. If you have any questions about completing this form accurately or with regard to your supporting documentation, please call a Customer Care Center Representative at
The Internal Revenue Service (IRS) has placed restrictions on when funds can be withdrawn from annuity contracts. If the contract owner is under age 59 ½ (or 70 ½ if 457(b) contract) when the request is signed, the distribution may be subject to an additional IRS 10% early withdrawal penalty tax. Please consult with your local IRS agency or personal tax advisor to determine if the transaction will be subject to taxes or penalties. Please read the attached related special tax notices.
B.About your surrender/withdrawal
I understand that any applicable Horace Mann contract charges or penalties and/or withholding taxes will apply and withholding taxes may reduce the requested distributed amount. I understand that
A net withdrawal allows you to receive a specific amount after taxes are withheld which will result in a larger amount withdrawn than you originally requested. A gross withdrawal will reduce the amount you requested by the taxes withheld. If no method is selected or if the selected method will not fulfill your request, we will
If there is a defaulted loan against your contract and the qualifying event in Section E allows, we will foreclose on the loan prior to distribution. If there is an active loan and you are requesting a full surrender and the qualifying event in Section E allows, we will pay off the loan balance using value from your contract/certificate and forward the remaining funds effective as of the next business day. If the annuity has a current loan that must remain in place, only the available amount will be withdrawn, and we will send you the reduced amount.
C.Your information
Name________________________________________________ Contract/Certificate # ______________________
Address ___________________________________ City _________________ State _________ ZIP ____________
Home phone # ___________________ Work phone # __________________ Last four digits of SSN _____________
D.Your requested amount (a reduced amount will be sent if your request exceeds the amount eligible for withdrawal)
1.■ surrender and terminate my contract, or
2.■ make a net withdrawal of $___________________ using the following method:
a.■ equally from each investment option, or
b.■
c.■ from the investment options indicated below**, or
3.■ make a gross withdrawal of $___________________ using the following method:
a.■ equally from each investment option, or
b.■
c.■ from the investment options indicated below**, or
4.■ withdraw only the free out amount (defined within my contract)
5.■ withdraw the amount indicated on the attached employer form to buy back years of service; employer acceptance included, using the following method:
a.■ equally from each investment option, or
b.■
c.■ from the investment options indicated below**, or
Page 1 of 13 |
Contract/Certificate # ______________________
6.■ withdraw my
**For 2c, 3c or 5c, please indicate amount ($), percentage (%), maximum amount allowed (“max”) or “all” (investment option table attached) remainder is not acceptable.
_________ from ________ |
_________ from ________ |
_________ from ________ |
_________ from ________ |
_________ from ________ |
_________ from ________ |
_________ from ________ |
_________ from ________ |
_________ from ________ |
_________ from ________ |
_________ from ________ |
_________ from ________ |
E.Your contract is a 403(b), 457(b) or 401(a) qualified plan and the reason for this request is:
■1. Cash value on account as of 12/23/88 (applies to withdrawal only)
■2. Disability — Horace Mann requires the attached Disability declaration from you and your doctor verifying that you are currently disabled and have been for at least three months (can not apply to loan foreclosures).
■3.
■4. Severance from
Date of severance ______________________________
F.Your tax withholding elections:
Federal income tax elections
Payments you receive from your annuity will be subject to federal income tax withholding as indicated below.
If your contract is a 401(a), 457(b) or 403(b) (includes Roth 403(b)), any portion of your distribution that is includable in income is subject to federal income tax withholding at a rate of 20 % and you may not elect out of this withholding requirement.
If your contract is a
If your contract is an IRA, Simple or SEP, the entire distribution, other than a return of excess contributions, is subject to federal income tax withholding at a rate 10%. You may elect withholding not to apply.
If your contract is a Roth, no federal income tax withholding is required.
If you elect not to have federal withholding apply to your annuity payments, or if you do not have enough federal income tax withheld, you may be responsible for payment of estimated tax and you may incur penalties under the estimated tax rules. Please consult your tax advisor for further information.
■I do not want to have federal income tax withheld from my payment, if allowed.
■I want federal income tax withheld from my payment as follows: $ ___________________________ or __________%.
State income tax election:
Some states require that we withhold state income tax when we withhold federal income tax and in these instances, we will calculate the amount of withholding for you. In some of these states, you may ask for no state income tax withholding (even though federal income tax was withheld) or you may specify the amount or percentage you want withheld. When you request an amount which is less than required by your state, we will withhold the required amount. In other states, no state income tax will apply unless you indicate the amount you want withheld.
State income tax withholding is not allowed in Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee,
Texas, Washington and Wyoming.
■I do not want to have state income tax withheld from my payment, if allowed in my state.
■I want state income tax withheld from my payment as follows:
$____________________________ or __________ %.
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Contract/Certificate # ______________________
G. Your surrender/withdrawal proceeds delivery method
■Send a check to my address.
■Deposit funds by Direct Deposit (electronically deposit funds directly into my bank account).
Bank name ____________________________________________________________________________________
Bank address __________________________________________________________________________________
Name on the account ____________________________________________________________________________
ABA routing ________________________________ Bank account # ___________________________________
■Checking (provide a copy of a voided check) OR ■ Savings (provide a savings deposit slip). When submitting a deposit slip, please contact your bank before submitting, as the routing numbers on deposit slips are not always accurate for use in EFT transactions.
H.Your signature(s) (must be completed)
By signing this request, I certify that I have read the attached special tax notices regarding my payment from this tax sheltered annuity and waive the 30 day notice period, if applicable. I acknowledge full responsibility for any and all federal and state income taxes and penalties. Furthermore, by signing this Annuity surrender/withdrawal request, I certify to the validity of the representations made to Horace Mann Life Insurance Company (HMLIC). I hold HMLIC and any or all of its affiliates, agents/insurance producers, and employees harmless from any and all liability past, present, and future that may arise as a result of this transaction. I authorize Horace Mann to provide data regarding this request to my Employer or Plan Administrator or their designee, when requested.
Client signature_____________________________________________________ Date _______________________
Address ______________________________________________________________________________________
Street |
City |
State |
ZIP |
■The address above is a permanent address change. If the address above is an address change or if you have made us aware of your address change within the past 15 days, we will send you a letter to confirm the new address change to both the previous and the new address. We will not release your distribution to you until the full 15 days following the address change has passed.
Spouse’s signature _____________________________________________________ Date ________________
If contract was issued in Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington or Wisconsin and the owner was married at the time of issue, the spouse’s signature is required.
Your plan administrator’s authorization
A plan administrator’s signature/authorization is required for all 401(a) or 457(b) contracts. If this contract is a 403(b), and your plan requires it, your plan administrator must authorize this request.
I authorize this surrender/withdrawal, as requested. I certify that I am authorized to act on behalf of the employer listed below. I have reviewed all records and have obtained all documentation required by the plan and certify that this transaction is authorized under the plan document. If severance was chosen as the reason for the distribution, the date of severance is ____________________________.
Name of employer or Third Party Administrator ________________________________________________________
Signature__________________________________________Title ________________________________________
Date _________________________
Your agent/insurance producer ______________________________________________ producer # ____________
Page 3 of 13 |
Disability declaration
Please have your physician read, sign and return this form with your request.
Client name ______________________________________________ Contract/Certificate number _________________
Residents of all states except Massachusetts:
Certification of disability as defined by the Internal Revenue Code Section 72(m)(7).
As the physician of the above named owner, I certify that he/she is disabled as defined by the following definition of disability
of IRC Section 72(m)(7):
“For purposes of this section, an individual shall be considered to be disabled if he is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in
death or to be
____________________________________________ |
__________________________________________ |
Client signature/date |
Physician signature/date |
Residents of Massachusetts:
Certification of disability as defined by Massachusetts law:
As the physician of the above named owner, I certify that he/she is disabled as defined as any of the following conditions: (check one of the following)
■Chronic Illness defined as a condition because of which an individual is (a) unable to perform at least two activities of daily living for a period of 90 days due to a loss of functional capacity, (b) having a level of disability similar to the level of disability described above, or (c) requiring substantial supervision to protect such individuals from threats to health and safety due to severe cognitive impairment.
■Terminal Illness is defined as a condition that will reasonably be expected to result in death in 24 months or less.
■Any medical condition including but not limited to acquired immune deficiency syndrome, coronary artery disease, major organ transplant, medical condition requiring continuous life support, permanent neurological deficit resulting from cerebral vascular accident, or other qualifying condition.
____________________________________________ |
_________________________________________ |
Client name signature/date |
Physician signature/date |
In cases that the individual qualifies for benefits because of Chronic Illness only, the benefit amount shall be payable only for expenses incurred for Qualified
I the owner, certify that any benefits paid solely due to Chronic Illness would be used to fund Qualified
Services.
____________________________________________
Client signature/date
Page 4 of 13 |
The following pages are for your retention; not necessary to return to Horace Mann
Annuity contract investment options; certain group annuities may be further limited by their plan
Investment style |
Investment option # Investment option name |
|
Life Cycle |
063 |
Wilshire VIT 2015 ETF Fund |
|
064 |
Wilshire VIT 2025 ETF Fund |
|
065 |
Wilshire VIT 2035 ETF Fund |
Asset Allocation |
076 |
Ibbotson Conservative ETF Asset Allocation Portfolio Class II |
|
077 |
Ibbotson Income & Growth ETF Asset Allocation Portfolio Class II |
|
078 |
Ibbotson Balanced ETF Asset Allocation Portfolio Class II |
|
079 |
Ibbotson Growth ETF Asset Allocation Portfolio Class II |
Large Company Value |
080 |
Ibbotson Aggressive Growth ETF Asset Allocation Portfolio Class II |
027 |
Davis Value Portfolio |
|
|
055 |
T. Rowe Price Equity Income Portfolio VIP II |
Large Company Core |
014 |
Wilshire Large Company Value Portfolio |
020 |
Fidelity VIP Growth and Income Portfolio (SC2) |
|
|
021 |
Fidelity VIP Index 500 Portfolio (SC2) |
|
069 |
JP Morgan Insurance Trust U.S. Equity Portfolio |
|
012(010) |
Wilshire 5000 Index Portfolio - (used prior to 9/5/00) |
|
001 |
Wilshire VIT Equity Fund |
Large Company Growth |
033 |
AllianceBernstein VPS Large Cap Growth Portfolio |
|
082 |
Delaware VIP 53 'ROWTHR3ERIES 3ERVICE Class |
|
023 |
Fidelity VIP Growth Portfolio (SC2) |
|
013(011) |
Wilshire Large Company Growth Portfolio (used prior to 9/5/00) |
056 |
AllianceBernstein VPS Small/Mid Cap Value |
|
|
081 |
American Century VP Mid Cap Value Class I |
|
037 |
Ariel Appreciation Fund |
|
036 |
Ariel Fund |
|
070 |
Goldman Sachs VIT Mid Cap Value |
028 |
Wells Fargo Advantage VT Opportunity Fund |
|
071 |
Calvert S & P Mid Cap 400 Index |
|
|
051 |
Dreyfus Inv Portfolio: Mid Cap Stock Portfolio (SC) |
|
022 |
Fidelity VIP Mid Cap Portfolio (SC2) |
031 |
Rainier Small/Mid Cap Equity Portfolio |
|
048 |
Delaware VIP Smid Cap Growth Series SC |
|
|
049 |
Lord Abbett Series Fund Growth Opportunities |
|
075 |
Putnam VT |
|
054 |
Wells Fargo Advantage VT Discovery Fund |
Small Company Value |
053 |
Royce Capital Fund Small Cap Portfolio |
|
017 |
T Rowe Price Small Cap Value Fund |
Small Company Core |
015 |
Wilshire Small Company Value Portfolio |
068 |
Dreyfus: Small Cap Stock Index Portfolio SC |
|
|
050 |
Goldman Sachs VIT Structured Small Cap Equity Fund |
|
072 |
Lazard Ret US |
|
032 |
Neuberger Berman Genesis Fund (Advisor Class) |
|
018 |
T Rowe Price Small Cap Stock Fund |
Small Company Growth |
057 |
AllianceBernstein VPS Small Cap Growth Portfolio |
|
092 |
Lord Abbett Developing Growht Portfolio |
|
016 |
Wilshire Small Company Growth Portfolio |
|
009 |
Wilshire VIT Small Cap Growth Fund |
International |
073 |
Fidelity VIP Emerging Markets SC2 |
|
024 |
Fidelity VIP Overseas Portfolio (SC2) |
|
008 |
Wilshire VIT International Equity Fund |
Specialty |
007 |
Wilshire VIT Socially Responsible Fund |
Real Estate |
067 |
Delaware VIP REIT Series (Service Class) |
Bond Options |
025 |
Fidelity VIP High Income Portfolio (SC2) |
|
026 |
Fidelity VIP Investment Grade Bond Portfolio (SC2) |
|
074 |
Templeton Global Bond Securities Fund |
Balanced |
003 |
Wilshire VIT Income Fund |
002 |
Wilshire VIT Balance Fund |
|
Money Market |
059 |
T Rowe Price Prime Reserve Portfolio |
Fixed |
000 |
Fixed Account |
|
805 |
5 year Guarantee Period Acct (variable group products only) |
|
807 |
7 year Guarantee Period Acct (variable group products only) |
|
810 |
10 year Guarantee Period Acct (variable group products only) |
|
815 |
5 year Guarantee Period Acct (fixed group products only) |
|
817 |
7 year Guarantee Period Acct (fixed group products only) |
|
820 |
10 year Guarantee Period Acct (fixed group products only) |
|
900 |
Special DCA Holding Account (unavailable to contracts issued in Oregon) |
|
901 |
Special |
|
902 |
Special |
|
903 |
Special |
|
998 |
Loan Account |
Page 5 of 13 |
Special tax notice for payments NOT from a Designated Roth account
This notice is based, in part, on an Internal Revenue Service model notice and as a result, certain sections of the notice may not be applicable to your Plan.
Your rollover options
You are receiving this notice because all or a portion of a payment you are receiving from a Horace Mann Life Insurance Company annuity issued under a tax qualified plan, section 403(b) plan or governmental section 457(b) plan (the “Plan”) is eligible to be rolled over to an IRA or an employer plan. This notice is intended to help you decide whether to do such a rollover.
This section of the notice describes the rollover rules that apply to payments from the Plan that are not from a designated Roth account (a type of account with special tax rules in some employer plans). If you also receive a payment from a designated Roth account in the Plan, you should read the “Special tax notice for payments from a Designated Roth account” latter in this document, and the Plan administrator or the payor will tell you the amount that is being paid from each account.
Rules that apply to most payments from a plan are described in the “General Information About Rollovers” section. Special rules that only apply in certain circumstances are described in the “Special Rules and Options” section.
General information about rollovers
How can a rollover affect my taxes?
You will be taxed on a payment from the Plan if you do not roll it over. If you are under age 59 1/2 and do not do a rollover, you will also have to pay a 10% additional income tax on early distributions (unless an exception applies). However, if you do a rollover, you will not have to pay tax until you receive payments later and the 10% additional income tax will not apply if those payments are made after you are age 59 1/2 (or if an exception applies).
Where may I roll over the payment?
You may roll over the payment to either an IRA (an individual retirement account or individual retirement annuity) or an employer plan (a
How do I do a rollover?
There are two ways to do a rollover. You can do either a direct rollover or a
If you do a direct rollover, the Plan will make the payment directly to your IRA or an employer plan. You should contact the IRS sponsor or the administrator of the employer plan for information on how to do a direct rollover.
If you do not do a direct rollover, you may still do a rollover by making a deposit into an IRA or eligible employer plan that will accept it. You will have 60 days after you receive the payment to make the deposit. If you do not do a direct rollover, the Plan is required to withhold 20% of the payment for federal income taxes (up to the amount of cash and property received other than employer stock). This means that, in order to roll over the entire payment in a
How much may I roll over?
If you wish to do a rollover, you may roll over all or part of the amount eligible for rollover. Any payment from the Plan is eligible for rollover, except:
•Certain payments spread over a period of at least 10 years or over your life or life expectancy (or the lives or joint life expectancy of you and your beneficiary)
•Required minimum distributions after age 70 1/2 (or after death)
•Hardship distributions
•Corrective distributions of contributions that exceed tax law limitations
•Loans treated as deemed distributions (for example, loans in default due to missed payments before your employment ends)
•Cost of life insurance paid by the Plan
•Contributions made under special automatic enrollment rules that are withdrawn pursuant to your request within 90 days of enrollment.
The Plan administrator or the payor can tell you what portion of a payment is eligible for rollover.
Page 6 of 13 |
If I don't do a rollover, will I have to pay the 10% additional income tax on early distributions?
If you are under age 59 1/2, you will have to pay the 10% additional income tax on early distributions for any payment from the Plan (including amounts withheld for income tax) that you do not roll over, unless one of the exceptions listed below applies. This tax is in addition to the regular income tax on the payment not rolled over. The 10% additional income tax does not apply to the following payments from the Plan:
•Payments made after you separate from service if you will be at least age 55 in the year of the separation.
•Payments that start after you separate from service if paid at least annually in equal or close to equal amounts over your life or life expectancy (or the lives or joint life expectancy of you and your beneficiary)
•Payments made due to disability
•Payments after your death
•Corrective distributions of contributions that exceed tax law limitations
•Cost of life insurance paid by the Plan.
•Contributions made under special automatic enrollment rules that are withdrawn pursuant to your request within 90 days of enrollment
•Payments made directly to the government to satisfy a federal tax levy
•Payments made under a qualified domestic relations order (QDRO).
•Payments up to the amount of your deductible medical expenses
•Certain payments made while you are on active duty if you were a member of a reserve component called to duty after September 11, 2001 for more than 179 days.
If I do a rollover to an IRA, will the 10% additional income tax apply to early distributions from the IRA?
If you receive a payment from an IRA when you are under age 59 1/2, you will have to pay the 10% additional income tax on early distributions from the IRA, unless an exception applies. In general, the exceptions to the 10% additional income tax for early distributions from an IRA are the same as the exceptions listed above for early distributions from a plan. However, there are a few differences for payments from an IRA, including:
•There is no exception for payments after separation from service that are made after age 55.
•The exception for payments made at least annually in equal or close to equal amounts over a specified period applies without regard to whether you have had a separation from service.
•The exception for qualified domestic relations orders (QDROs) does not apply (although a special rule applies under which, as part of a divorce or separation agreement, a
•There are additional exceptions for (1) payments for qualified higher education expenses, (2) payments up to $10,000 used in a qualified
Will I owe State income taxes?
This notice does not describe any State or local income tax rules (including withholding rules).
Special rules and options
If your payment includes
You may roll over to an IRA a payment that includes
You may roll over to an employer plan all of a payment that includes
Page 7 of 13 |
If you miss the
If you have an outstanding loan that is being offset
If you have an outstanding loan from the Plan, your Plan benefit may be offset by the amount of the loan, typically when your employment ends. The loan offset amount is treated as a distribution to you at the time of the offset and will be taxed (including the 10% additional income tax on early distributions, unless an exception applies) unless you do a
If you were born on or before January 1, 1936
If you were born on or before January 1, 1936 and receive a lump sum distribution that you do not roll over, special rules for calculating the amount of the tax on the payment might apply to you. For more information, see IRS Publication 575, Pension and Annuity Income.
If your payment is from a governmental section 457(b) plan
If the Plan is a governmental section 457(b) plan, the same rules described elsewhere in this notice generally apply, allowing you to roll over the payment to an IRA or an employer plan that accepts rollovers. One difference is that, if you do not do a rollover, you will not have to pay the 10% additional income tax on early distributions from the Plan even if you are under age 59 1/2 (unless the payment is from a separate account holding rollover contributions that were made to the Plan from a
If you roll over your payment to a Roth IRA You can roll over a payment from the Plan made before January 1, 2010 to a Roth IRA only if your modified adjusted gross income is not more than $100,000 for the year the payment is made to you and, if married, you file a joint return. These limitations do not apply to payments made to you from the Plan after 2009. If you wish to roll over the payment to a Roth IRA, but you are not eligible
to do a rollover to a Roth IRA until after 2009, you can do a rollover to a traditional IRA and then, after 2009, elect to convert the traditional IRA into a Roth IRA.
If you roll over the payment to a Roth IRA, a special rule applies under which the amount of the payment rolled over (reduced by any
If you roll over the payment to a Roth IRA, later payments from the Roth IRA that are qualified distributions will not be taxed (including earnings after the rollover). A qualified distribution from a Roth IRA is a payment made after you are age 59 1/2 (or after your death or disability, or as a qualified
You cannot roll over a payment from the Plan to a designated Roth account in an employer plan.
If you are not a plan participant Payments after death of the participant. If you receive a distribution after the participant's death that you do not roll over, the distribution will generally be taxed in the same manner described elsewhere in this notice. However, the 10% additional income tax on early distributions do not apply and the special rule described under the section “If you were born on or before January 1, 1936” applies only if the participant was born on or before January 1, 1936.
If you are a surviving spouse.
If you receive a payment from the Plan as the surviving spouse of a deceased participant, you have the same rollover options that the participant would have had, as described elsewhere in this notice. In addition, if you choose to do a rollover to an IRA, you may treat the IRA as your own or as an inherited IRA.
An IRA you treat as your own is treated like any other IRA of yours, so that payments made to you before you are age 59 1/2 will be subject to the 10% additional income tax on early distributions (unless an exception applies) and required minimum distributions from your IRA do not have to start until after you are age 70 1/2.
Page 8 of 13 |
If you treat the IRA as an inherited IRA, payments from the IRA will not be subject to the 10% additional income tax on early distributions. However, if the participant had started taking required minimum distributions, you will have to receive required minimum distributions from the inherited IRA. If the participant had not started taking required minimum distributions from the Plan, you will not have to start receiving required minimum distributions from the inherited IRA until the year the participant would have been age 70 1/2.
If you are a surviving beneficiary other than a spouse. If you receive a payment from the Plan because of the participant's death and you are a designated beneficiary other than a surviving spouse, the only rollover option you have is to do a direct rollover to an inherited IRA. Payments from the inherited IRA will not be subject to the 10% additional income tax on early distributions. You will have to receive required minimum distributions from the inherited IRA.
Payments under a qualified domestic relations order. If you are the spouse or former spouse of the participant who receives a payment from the Plan under a qualified domestic relations order (QDRO), you generally have the same options the participant would have (for example, you may roll over the payment to your own IRA or an eligible employer plan that will accept it). Payments under the QDRO will not be subject to the 10% additional income tax on early distributions.
If you are a nonresident alien
If you are a nonresident alien and you do not do a direct rollover to a U.S. IRA or U.S. employer plan, instead of withholding 20%, the Plan is generally required to withhold 30% of the payment for federal income taxes. If the amount withheld exceeds the amount of tax you owe (as may happen if you do a
Other special rules
If a payment is one in a series of payments for less than 10 years, your choice whether to make a direct rollover will apply to all later payments in the series (unless you make a different choice for later payments).
If your payments for the year are less than $200 (not including payments from a designated Roth account in the Plan), the Plan is not required to allow you to do a direct rollover and is not required to withhold for federal income taxes. However, you may do a
Unless you elect otherwise, a mandatory cashout of more than $1,000 (not including payments from a designated Roth account in the Plan) will be directly rolled over to an IRA chosen by the Plan administrator or the payor. A mandatory cashout is a payment from a plan to a participant made before age 62 (or normal retirement age, if later) and without consent, where the participant's benefit does not exceed $5,000 (not including any amounts held under the plan as a result of a prior rollover made to the plan).
You may have special rollover rights if you recently served in the U.S. Armed Forces. For more information, see IRS Publication 3, Armed Forces' Tax Guide.
For more information
You may wish to consult with the Plan administrator or payor, or a professional tax advisor, before taking a payment from the Plan. Also, you can find more detailed information on the federal tax treatment of payments from employer plans in: IRS Publication 575, Pension and Annuity Income; IRS Publication 590, Individual Retirement Arrangements (IRAs); and IRS Publication 571,
Page 9 of 13 |
Special tax notice for payments from a Designated Roth account
This notice is based, in part, on an Internal Revenue Service model notice and as a result, certain sections of the notice may not be applicable to your Plan.
General information
A designated Roth contribution is an elective contribution under a cash or deferred arrangement that is (i) designated by the employee at the time of the cash or deferred election as a designated Roth contribution that is being made in lieu of all or a portion of the
Your rollover options
You are receiving this notice because all or a portion of a payment you are receiving from a Horace Mann Life Insurance Company annuity issued under a section 403(b) plan or governmental section 457(b) plan (the “Plan”) is eligible to be rolled over to a Roth IRA or designated Roth account in an employer plan. This notice is intended to help you decide whether to do a rollover.
This section of the notice describes the rollover rules that apply to payments from the Plan that are from a designated Roth account. If you also receive a payment from the Plan that is not from a designated Roth account, you should read the separate notice “Special tax notice for payments not from a Designated Roth account” provided earlier in this document, and the Plan administrator or the payor will tell you the amount that is being paid from each account.
Rules that apply to most payments from a designated Roth account are described in the “General Information About Rollovers” section. Special rules that only apply in certain circumstances are described in the “Special Rules and Options” section.
General information about rollovers
How can a rollover affect my taxes?
If the payment from the Plan is not a qualified distribution and you do not do a rollover to a Roth IRA or a designated Roth account in an employer plan, you will be taxed on the earnings in the payment. If you are under age 59 1/2, a 10% additional income tax on early distributions will also apply to the earnings (unless an exception applies).
If the payment from the Plan is a qualified distribution, you will not be taxed on any part of the payment even if you do not do a rollover. If you do a rollover, you will not be taxed on the amount you roll over and any earnings on the amount you roll over will not be taxed if paid later in a qualified distribution.
A qualified distribution from a designated Roth account in the Plan is a payment made after you are age 59 1/2 (or after your death or disability) and after you have had a designated Roth account in the Plan for at least 5 years. In applying the
However, if you do a rollover, you will not have to pay taxes currently on the earnings and you will not have to pay taxes later on payments that are qualified distributions.
Where may I roll over the payment?
You may roll over the payment to either a Roth IRA (a Roth individual retirement account or Roth individual retirement annuity) or a designated Roth account in an employer plan (a
•If you do a rollover to a Roth IRA, all of your Roth IRAs will be considered for purposes of determining whether you have satisfied the
•If you do a rollover to a Roth IRA, you will not be required to take a distribution from the Roth IRA during your lifetime and you must keep track of the aggregate amount of the
•Eligible rollover distributions from a Roth IRA can only be rolled over to another Roth IRA.
Page 10 of 13 |