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  • What to Expect After Payment Begins


What happens to the balance in my account after I start withdrawals?
If you choose to take periodic payments or minimum distribution payments from the plan, the balance of your account will stay invested in the products you have chosen. You may transfer your funds among the program's products in the same manner as active participants. The fees which apply to active participants' accounts will also apply to your account. You will continue to receive an account statement from the plan each quarter and you may continue to obtain current information about your account through KeyTalk® (800-922-7772).

If you choose to purchase an annuity, the funds in your account will be transferred to the insurance company. The insurance company will send you a notice letter verifying all aspects of the annuity purchase with your first payment. Be sure to keep this letter with your important documents since it is the only report you will receive from the insurance company other than your annual 1099-R form. Once an annuity is established, it generally may not be changed and you may not withdraw or transfer funds.

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What happens if I face a financial emergency after I begin distributions?
If you are receiving periodic payments or minimum distribution payments, you may request an additional lump sum amount by completing a Lump Sum Distribution Request form. (Depending on the payment method you have been using, your future periodic or minimum distribution payments may be reduced as a result.)

  • If you are receiving periodic payments and need to increase your fixed payment amount or shorten your payment period, you may do that by filing a new Periodic Payment Distribution Request form.
  • If you have purchased a fixed or a lifetime annuity, you may not make any changes in that annuity distribution.

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Will payments from this program have any impact on my Social Security benefits?
Withdrawals from the program are not subject to Social Security taxes nor earnings test limits at the time of distribution. If the Social Security Administration should ever notify you that your distributions from either plan are being counted in earnings test limits, please contact the administrator or the state Treasury Department's Deferred Compensation Office for assistance.

May I make contributions to my account while I am retired?
After you leave state service, you will not be eligible to make any further contributions to your account, nor to take a loan against your 401(k) account.

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What happens if I return to service after my payments begin?
Annuity payments may not be changed once they have begun; however, periodic payments from the 401(k) plan or the 457 plan may be stopped while you are re-employed if your reemployment is expected to continue for more than 100 paid days.

Deferrals to either plan may be made while you are re-employed; however, if you make contributions to the 401(k) plan during a temporary reemployment period in which you also receive benefits from TCRS or the ORP, you will not be eligible to receive matching employer contributions.

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May benefits from this program be assigned under court orders?
The assets in the 457 trust and the 401(k) trust are exempt from execution, attachment, garnishment, or other process, except levies issued by the Internal Revenue Service. The value of a member's account may be considered when dividing marital assets at the dissolution of a marriage; however, since government plans are not subject to ERISA, the funds from the account can not be paid directly to an ex-spouse by the plan. See Tennessee Code Annotated, Section 26-2-105.