CHAPTER 16
DOMESTIC RELATIONS ORDERS AND OTHER ASSIGNMENTS
[Prior to 11/24/04, see 581—Ch 21]
495—16.1(97B) Garnishments and income withholding orders.
	16.1(1) For the limited purposes of this rule, the term “member” includes IPERS members, beneficiaries, contingent annuitants and any other third-party payees to whom IPERS is paying a monthly benefit or a lump sum distribution.
	16.1(2) A member’s right to any payment from IPERS is not transferable or assignable and is not subject to execution, levy, attachment, garnishment, or other legal process, including bankruptcy or insolvency law, except for the purpose of enforcing child, spousal, or medical support.
	16.1(3) Only members receiving payment from IPERS, including monthly benefits and lump sum distributions, may be subject to garnishment, attachment, or execution against funds that are payable. Such garnishment, attachment, or execution is not valid and enforceable for members who have not applied for and have not been approved to receive funds from IPERS.
	16.1(4) Upon receipt of an income withholding order issued by the Iowa department of human services or a court, IPERS shall send a copy of the withholding order to the member. If a garnishment has been issued by a court, the party pursuing the garnishment shall send a notice pursuant to Iowa law to the member against whom the garnishment is issued.
	16.1(5) IPERS shall continue to withhold a portion of the member’s monthly benefit as specified in the initial withholding order until instructed by the court or the Iowa department of human services issuing the order to amend or cease payment. IPERS shall continue to withhold a portion of the member’s monthly benefit as specified in the garnishment until the garnishment expires or is released.
	16.1(6) Funds withheld or garnished are taxable to the member. IPERS may assess a fee of $2 per payment in accordance with Iowa Code section 252D.18A(2). The fee will be deducted from the gross amount, less federal and state income tax, before a distribution is divided.
	16.1(7) A garnishment, attachment or execution may not be levied upon funds which are already the subject of a levy, including a levy placed upon funds by the United States Internal Revenue Service, unless the requirements of IRC Section 6334(a)(8) are met. Multiple garnishments, attachments and executions are allowed as long as the amount levied upon does not exceed the limitations prescribed in 15 U.S.C. Section 1673(b).
	16.1(8) IPERS may release information relating to entitlement to funds to a court or to the Iowa department of human services prior to receipt of a valid garnishment, attachment, execution, or income withholding order when presented with a written request stating the information requested and reasons for the request. This request must be signed by a magistrate, judge, or child support recovery unit director or the director’s designee, including an attorney representing the Iowa department of human services. In addition, IPERS may release information to the Iowa department of human services through automated matches.
495—16.2(97B) Domestic relations orders. This rule shall apply only to marital property orders. All support orders shall continue to be administered under rule 495—16.1(97B).
	16.2(1) Definitions.
“Administrable domestic relations order” or “ADRO” means a domestic relations order that divides the marital property of same gender spouses, assigns to same gender alternate payees the right to receive all or a portion of the benefits payable with respect to a member under IPERS, and meets the requirements of this rule.
“Alternate payee” means a spouse or former spouse, regardless of gender, of a member who is recognized by a domestic relations order as having a right to receive all or a portion of the benefits payable by IPERS with respect to such member.
“Benefits” means, for purposes of this rule and depending on the context, a refund, monthly allowance (including monthly allowance paid as an actuarial equivalent (AE)), or death benefit payable with respect to a member covered under IPERS. “Benefits” does not include dividends payable under Iowa Code section 97B.49 or other cost-of-living increases unless specifically provided for in a QDRO or an ADRO.
“Domestic relations order” means any judgment, decree, or order which relates to the provision of marital property rights to a spouse or former spouse, regardless of gender, of a member and is made pursuant to the domestic relations laws of a state.
“Member” means, for purposes of this rule, IPERS members, beneficiaries, and contingent annuitants.
“Qualified domestic relations order” or “QDRO” means a domestic relations order that divides the marital property of opposite gender spouses and assigns to an opposite gender alternate payee the right to receive all or a portion of the benefits payable with respect to a member under IPERS and meets the requirements of this rule.
“Same gender spouse” or “same gender former spouse” means a spouse or former spouse who is the same sex as the member.
“Successor alternate payee” means a person or persons named in a domestic relations order to receive the amounts payable to the alternate payee under the QDRO or ADRO if the alternate payee dies before the member. Successor alternate payees must be named individuals, not a class of individuals, a trust or an estate.
“Trigger event” means a distribution or series of distributions of benefits made with respect to a member.
	16.2(2) Requirements.
	a. 	Mandatory provisions. A domestic relations order is a QDRO or an ADRO if such order:
	(1)	Clearly specifies the member’s name and last-known mailing address, member identification number or social security number, and the names and last-known mailing addresses and social security numbers of alternate payees. This information shall be provided to IPERS in a cover letter or a court’s Confidential Information Form;
	(2)	Clearly specifies a fixed dollar amount or a percentage, but not both, of the member’s benefits to be paid by IPERS to the alternate payee or the manner in which the fixed dollar amount or percentage is to be determined, provided that no such method shall require IPERS to perform present value calculations of the member’s accrued benefit;
	(3)	Clearly specifies the period to which such order applies, including whether benefits cease upon the death or remarriage of the alternate payee;
	(4)	Clearly specifies that the order applies to IPERS;
	(5)	Clearly specifies that the order is for purposes of making a property division; and
	(6)	Is clearly signed by the judge and filed with the clerk of court. IPERS will consider an order duly signed if it carries an original signature, a stamp bearing the judge’s signature, or is conformed in accordance with local court rules.
	b. 	Prohibited provisions. A domestic relations order is not a QDRO or an ADRO if such order:
	(1)	Requires IPERS to provide any type or form of benefit or any option not otherwise provided under Iowa Code chapter 97B;
	(2)	Requires IPERS to provide increased benefits determined on the basis of actuarial value;
	(3)	Requires the payment of benefits to an alternate payee which are required to be paid to another alternate payee under another order previously determined by IPERS to be a QDRO or an ADRO;
	(4)	Requires any action by IPERS that is contrary to its governing statutes or plan provisions;
	(5)	Awards any future benefit increases that are provided by the legislature, except as provided in subparagraph 16.2(2)“c”(2); or
	(6)	Requires the payment of benefits to an alternate payee prior to a trigger event.
	c. 	Permitted provisions. A QDRO or an ADRO may also:
	(1)	If a trigger event has not occurred as of the date the order is received by IPERS, name an alternate payee as a designated beneficiary or contingent annuitant, require the payment of benefits under a particular benefit option, or both;
	(2)	Specify that the alternate payee shall be entitled to a fixed dollar amount or percentage of dividend payments, or cost-of-living increase or any other postretirement benefit increase to the member (all known as dividend payments), as follows:
	1.	If the court order awards a fixed dollar amount of benefits to the alternate payee, the dollar amount of dividend payments to be added or method for determining said dollar amount shall be stated in the court order or an award of a share of dividend payments shall be given no effect; and
	2.	If the court order awards a specified percentage of benefits to the alternate payee, IPERS shall add dividends to the alternate payee’s share of the retirement allowance as necessary to keep the alternate payee’s share of payments at the percentage specified in the court order;
	(3)	Bar a vested member from requesting a refund of the member’s accumulated contributions without the alternate payee’s written consent;
	(4)	Allow benefits to be paid to an alternate payee based on a period of reemployment for a retired member; and
	(5)	Name a successor alternate payee to receive the amounts that would have been payable to the member’s spouse or former spouse under the order, if the alternate payee dies before the member. The designation of a successor alternate payee in an order shall be void and be given no effect if IPERS does not receive confirmation of the successor’s name, social security number, and last-known mailing address in a cover letter or in a copy of the court’s confidential information form. A QDRO or an ADRO that lists a series of default successor alternate payees by class or permits a successor alternate payee to designate additional successor alternate payees is not permitted and will be rejected. Once a QDRO or an ADRO is accepted by IPERS for administration, in order to change the designation of successor alternate payees, an amended order is required.
	16.2(3) Administrative provisions.
	a. 	Payment to an alternate payee shall be made in a like manner and at the same time that payment is made to the member. Payment to the alternate payee shall be in a lump sum if benefits are paid in a lump sum distribution or as monthly payments if a retirement option is in effect. A member shall not be able to receive an actuarial equivalent (AE) under Iowa Code section 97B.48(1) unless the total benefit payable with respect to that member meets the applicable requirements. All divisions of benefits shall be based on the gross amount of monthly or lump sum benefits payable. Federal and state income taxes shall be deducted from the member’s and alternate payee’s respective shares and reported under their respective federal tax identification numbers. Unrecovered basis shall be allocated on a pro rata basis to the member and alternate payee.
	b. 	The alternate payee shall not be entitled to any share of the member’s death benefits except to the extent such entitlement is recognized in a QDRO or an ADRO or in a beneficiary designation filed subsequent to the dissolution.
	c. 	If a QDRO or an ADRO directs the member to name the alternate payee under the order as a designated beneficiary, and the member fails to do so, the provisions of the QDRO or ADRO awarding the alternate payee a share of the member’s death benefit shall be deemed, except as revoked or modified in a subsequent QDRO or ADRO, to operate as a beneficiary designation, and shall be given first priority by IPERS in the determination and payment of such member’s death benefits. Death benefits remaining after payments required by the QDRO or ADRO, to the extent possible, shall then be made according to the terms of the member’s most recent beneficiary designation.
	d. 	If an alternate payee has been awarded a share of the member’s benefits and dies before the member, the entire account value shall be restored to the member unless otherwise specified in the order and in the manner required under this rule.
	e. 	An alternate payee shall not receive a share of dividends or other cost-of-living increases, unless so provided in a QDRO or an ADRO.
	f. 	The CEO, or CEO’s designee, shall have exclusive authority to determine whether a domestic relations order is a QDRO or an ADRO. A final determination by the CEO, or CEO’s designee, may be appealed in the same manner as any other final agency determination under Iowa Code chapter 97B.
	g. 	A person who attempts to make IPERS a party to a domestic relations action in order to determine an alternate payee’s right to receive a portion of the benefits payable to a member shall be liable to IPERS for its costs and attorney’s fees.
	h. 	A domestic relations order shall not become effective until it is approved by IPERS. If a member is receiving a retirement allowance at the time a domestic relations order is received by the system, the order shall be effective only with respect to payments made after the order is determined to be a QDRO or an ADRO. If distributions have already begun at the time that an order is determined by IPERS to be a QDRO or an ADRO, the order shall be deemed to be the alternate payee’s application to begin receiving payments under the QDRO or ADRO. Payment to the alternate payee will be paid for the month the order is accepted by IPERS. If the member is not receiving a retirement allowance at the time a domestic relations order is approved by IPERS and the member applies for a refund or monthly allowance, or dies, no distributions shall be made until the respective rights of the parties under the domestic relations order are determined by IPERS. If IPERS has placed a hold on the member’s account following written or verbal notification from the member, member’s spouse, or legal representative of either party of a pending dissolution of marriage, and no further contacts are received from either party or their representatives within the following one-year period, IPERS shall release the hold.
	i. 	IPERS and its staff shall have no liability for making or withholding payments in accordance with the provisions of this rule.
	j. 	IPERS has no duty or responsibility to search for alternate payees. Alternate payees must notify IPERS of any change in their mailing addresses. IPERS shall contact the alternate payee in writing, notifying the alternate payee that an application for a distribution has been requested by the member. IPERS shall send the alternate payee an application to be completed and returned to IPERS. The written notice shall inform the alternate payee that if the alternate payee does not return the application to IPERS within 60 days after the materials are mailed by IPERS, the amounts otherwise payable to the alternate payee shall be paid to the member or the member’s beneficiary(ies) until a valid application is received and accepted by IPERS. IPERS shall have no liability to the alternate payee with respect to payment of such amounts.
	k. 	If a QDRO or an ADRO requires the member to select an option with joint and survivor provisions (Option 4 or 6) and name the alternate payee as contingent annuitant, acceptable birth proof for the contingent annuitant pursuant to 495—subrule 11.1(2) shall be provided to IPERS prior to the order being approved by IPERS.
	l. 	For both lump sum and monthly payments, the alternate payee’s tax withholding and rollover elections, if eligible, must be received before the first or current month’s benefit is certified for payment or IPERS will use the applicable default tax withholding elections.
	m. 	If an order that is determined to be a QDRO or an ADRO divides a member’s account using a service factor formula and the member’s IPERS benefits are based on a number of quarters less than the member’s total covered quarters, notwithstanding any terms of the order to the contrary, IPERS shall limit the number of quarters used in the numerator and the denominator of the service fraction to the number of quarters actually used in the calculation of IPERS benefits.
	n. 	Service credit that is purchased during the period when the member is married to the alternate payee shall be added to the numerator and the denominator of the service fraction when calculating the service factor pursuant to a domestic relations order. Service credit that is purchased during a period when the member is not married to the alternate payee shall only be added to the denominator of the service fraction when calculating the service factor pursuant to a domestic relations order. Under no circumstances shall the number of quarters in the denominator be more than the number of quarters used to calculate the member’s benefit.
	o. 	The parties or their attorneys in a dissolution action involving an IPERS member shall decide between themselves which attorney will submit a proposed domestic relations order to IPERS for review. IPERS shall not review a proposed order that has not been approved as to form by both parties or their counsel. A rejection under this paragraph shall not preclude IPERS from placing a hold on a member’s account until the status of a proposed order as a QDRO or an ADRO is resolved.
	p. 	If a domestic relations order has been determined by the system to be an ADRO, before the system will accept the ADRO for current or deferred administration, the alternate payee under that final order shall be required to complete any forms required by IPERS for purposes of determining the proper tax treatment of current or future distributions to that alternate payee in accordance with federal laws governing such distributions.
	q. 	If a member with an IPERS-approved QDRO or ADRO is receiving a distribution according to a qualified benefits arrangement (QBA), the alternate payee shall share in the distribution to the member unless the order specifically states otherwise.
[ARC 8601B, IAB 3/10/10, effective 4/14/10; ARC 8929B, IAB 7/14/10, effective 6/21/10]
These rules are intended to implement Iowa Code sections 97B.4, 97B.15, 97B.25, 97B.38 and 97B.39.
[Filed 11/5/04, Notice 9/15/04—published 11/24/04, effective 12/29/04]
[Filed 5/3/07, Notice 3/28/07—published 5/23/07, effective 6/27/07]
[Filed 12/12/07, Notice 11/7/07—published 1/2/08, effective 2/6/08]
[Filed 8/8/08, Notice 7/2/08—published 8/27/08, effective 10/1/08]
[Filed ARC 8601B (Notice ARC 8477B, IAB 1/13/10), IAB 3/10/10, effective 4/14/10]
[Filed Emergency ARC 8929B, IAB 7/14/10, effective 6/21/10]