Texas Vernon’s Civil Statutes
Sec. § 6.141
Deferred Annuitization of Certain Drop Accounts


(a)

This section applies only to a pensioner who:

(1)

before attaining 50 years of age:

(A)

left active service; and

(B)

was granted a service retirement pension under Section 6.01 or 6.02 of this article;

(2)

since the pensioners retirement has continued to receive substantially equal periodic payments, as determined under Section 72(t) of the code; and

(3)

on September 1, 2017:

(A)

is a DROP participant; and

(B)

has not attained 59-1/2 years of age.

(b)

Notwithstanding Section 6.14 of this article and solely to avoid the possibility of an early distribution tax penalty under Section 72(t)(4) of the code:

(1)

a pensioner subject to this section may until the pensioner attains 59-1/2 years of age:

(A)

subject to Subsection (c) of this section, continue to participate in DROP;

(B)

have the same amount of the pensioners service retirement pension credited to the pensioners DROP account as has been credited since the pensioners service retirement pension was initially granted; and

(C)

defer annuitization of the pensioners DROP account under Section 6.14(e) of this article; and

(2)

once a pensioner subject to this section attains 59-1/2 years of age:

(A)

the pensioner may not have any portion of the pensioners service retirement pension credited to the pensioners DROP account; and

(B)

as soon as administratively feasible, the balance in the pensioners DROP account shall be annuitized and distributed to the pensioner in accordance with Section 6.14(e) of this article.

(c)

The DROP account of a pensioner who continues participation in DROP under Subsection (b)(1)(A) of this section does not accrue interest on and after September 1, 2017.
Source
Last accessed
Oct. 18, 2019