[Federal Register Volume 59, Number 176 (Tuesday, September 13, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-22482]


[[Page Unknown]]

[Federal Register: September 13, 1994]


                                                   VOL. 59, NO. 176

                                        Tuesday, September 13, 1994

FEDERAL RETIREMENT THRIFT INVESTMENT BOARD

5 CFR Part 1650

 

Methods of Withdrawing Funds From the Thrift Savings Plan

AGENCY: Federal Retirement Thrift Investment Board.

ACTION: Proposed rule.

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SUMMARY: The Executive Director of the Federal Retirement Thrift 
Investment Board is proposing to revise regulations on spousal rights 
in accordance with changes made to the Federal Employees' Retirement 
System Act of 1986 (FERSA) by Public Law 103-226 to delete all 
references to former spouses and to accord all spouses of TSP 
participants covered by the Federal Employees' Retirement System (FERS) 
the right to a survivor annuity, unless they waive that option.

DATES: Comments must be submitted on or before October 13, 1994.

ADDRESSES: Comments may be sent to Robert Bloom, Assistant General 
Counsel (Administration), Federal Retirement Thrift Investment Board, 
1250 H Street NW., Washington, DC 20005.

FOR FURTHER INFORMATION CONTACT:
Robert Bloom at (202) 942-1662, FAX (202) 942-1676.

SUPPLEMENTARY INFORMATION: Public Law 103-226, 108 Stat. 111 (March 30, 
1994), amends FERSA, 5 U.S.C. chapter 84 and section 8351, to give all 
TSP participants, regardless of their eligibility for basic retirement 
benefits, the same withdrawal options upon separation that have 
previously been available only to participants who separate with 
eligibility for basic retirement benefits. As a result, spouses of all 
TSP participants, regardless of the participant's eligibility for basic 
retirement benefits, have been provided with the same rights as those 
previously available to spouses of participants who were eligible for 
basic retirement benefits. This means that spouses of FERS participants 
who were previously only entitled to notice (if the participant 
separated without eligibility for basic retirement benefits) now have 
the right to a survivor annuity, unless the spouse waives that right. 
The required annuity is a joint life annuity with the spouse with 50 
percent survivor benefits, level payments, and a no cash refund 
feature. As a result of this statutory change, 5 CFR 1650.17 has been 
revised to delete the requirement to notify the spouse with the TSP 
participant who is covered by FERS lacks eligibility for basic 
retirement benefits.
    Spouses of Civil Service Retirement System (CSRS) participants are 
entitled to notice whether or not the participant separated from 
Federal service with eligibility for basic retirement benefits. This 
notice requirement was not affected by Public Law 103-226.
    Public Law 103-226 also eliminates the requirement to notify former 
spouses of FERS and CSRS participants who separate from Federal service 
without eligibility for basic retirement benefits that the participant 
is withdrawing his or her TSP account. Accordingly, all references to 
former spouse have been eliminated from 5 CFR part 1650, subpart G. 
(Because there are no longer any references to ``former spouses,'' the 
word ``current'' has also been eliminated wherever it appeared to 
describe the spouse to whom a participant is married.) This means that 
participants are no longer required to provide the TSP Service Office 
with an address for a former spouse, or, if a former spouse cannot be 
located, to obtain an exception to the requirement to notify a former 
spouse.
    In addition to the changes made by Public Law 103-226, other 
changes explain or clarify spousal rights and exceptions to those 
rights. Section 1650.19 is revised to delete language stating that the 
employee and spouse may jointly waive the survivor annuity. The 
participant waives the survivor annuity by electing a different 
withdrawal option, while it is the spouse who must explicitly sign a 
waiver statement.
    Section 1650.21 provides that the Executive Director may grant an 
exception to the requirement to obtain the spouse's signature or the 
spouse notice requirement where the participant establishes to the 
satisfaction of the Executive Director that the spouse's whereabouts 
cannot be determined. The requirement to obtain the spouse's signature 
on the appropriate form to waive the joint and survivor annuity is 
referred to as the signature requirement. The notice requirement refers 
to the entitlement of the spouse of a CSRS participant to notice of the 
participant's withdrawal election. This section is being revised to 
allow participants who are seeking an exception to the signature or the 
notice requirement based on whereabouts unknown to submit statements in 
lieu of affidavits or declarations in support of their requests. These 
statements must be made pursuant to 18 U.S.C. 1001, which provides that 
whoever, in any matter within the jurisdiction of any department or 
agency of the United States knowingly and willfully falsifies, conceals 
or covers up by any trick, scheme, or device a material fact, or makes 
any false, fictitious or fraudulent statements or representations, or 
makes or uses any false writing or document knowing the same to contain 
any false, fictitious or fraudulent statement or entry, shall be fined 
not more than $10,000 or imprisoned not more than five years, or both.
    To ensure that the persons making the statements are aware of the 
possible penalty, Sec. 1650.21(c) requires inclusion of the following 
on each statement: I understand that a false statement or willful 
misrepresentation is punishable under Federal Law (18 U.S.C. 1001) by a 
fine or imprisonment or both.
    To ease the burden on participants further, Secs. 1650.21 and 
1650.22 are being revised to delete the requirement that the 
participant obtain and provide only documents bearing an original 
signature or which are embossed or which bear the imprint of a seal. 
Participants may now submit photocopies of documents.
    Sections 1650.21(d) and 1650.22(c) are added to explain that a 
withdrawal form received within one year of approval of the exception 
may be processed without a new exception. An exception is valid only 
for the spouse for whom the exception has been approved.
    Sections 1650.21(e) and 1650.22(d) are added to explain that the 
requirements for establishing an exception in a loan application in 5 
CFR 1655.18 are the same as those for establishing an exception in a 
withdrawal application. It is for this purpose that the loan provisions 
are cross-referenced.
    Finally, Sec. 1650.22 provides that the Executive Director may 
grant an exception to the requirement that the participant obtain his 
or her spouse's signature where there are exceptional circumstances 
that warrant such an exception. In Sec. 1650.22(b)(2)(iii) the example 
of an acceptable court order which would relieve a participant of the 
obligation to obtain his or her spouse's signature is revised.

Regulatory Flexibility Act

    I certify that these regulations will not have a significant 
economic impact on a substantial number of small entities. They will 
affect Board procedures relating to the processing of requests for 
exceptions to spouse signature and notice requirements applicable to 
certain requests to withdraw account balances.

E.O. 12291

    I certify that this is not a major rule.

Paperwork Reduction Act

    I certify that these regulations do not require additional 
reporting under the criteria of the Paperwork Reduction Act of 1980.

List of Subjects in 5 CFR Part 1650

    Employment benefit plans, Government employees, Retirement, 
Pensions.

    Dated: September 6, 1994.
Roger W. Mehle,
Executive Director, Federal Retirement Thrift Investment Board.

    For the reasons set out in the preamble, part 1650 of chapter VI of 
title 5 of the Code of Federal Regulations is amended as set forth 
below.

PART 1650--[AMENDED]

    1. The authority citation for part 1650 is revised to read as 
follows:

    Authority: 5 U.S.C. 8351, 8433, 8434(a)(2)(E), 8434(b), 8435, 
8436(b), 8467, 8474(b)(5) and 8474(c)(1).

    2. Section 1650.16 is amended by revising the introductory text of 
paragraph (a) and paragraph (b) to read as follows:


Sec. 1650.16  General.

    (a) Pursuant to 5 U.S.C. 8435, 8351, and 8467, spouses of 
participants are entitled under certain circumstances to:
* * * * *
    (b) This subpart enumerates the circumstances under which such 
spousal rights arise and prescribes the procedures which must be 
followed by participants, spouses, and the Board to implement such 
rights.
    3. Section 1650.17 is revised to read as follows:


Sec. 1650.17  Withdrawal elections requiring notification to spouses.

    No election of benefits, change of election of benefits, or 
modification of the commencement date of an annuity can be made 
effective for a CSRS participant prior to notice to the spouse of the 
participant in accordance with the requirements of Sec. 1650.20.
    4. Section 1650.18 is revised to read as follows:


Sec. 1650.18  Withdrawal elections requiring spousal waiver.

    No withdrawal election may be made or changed by a FERS participant 
which would defeat the spouse's entitlement to a survivor annuity 
unless the affected spouse has signed the appropriate TSP form waiving 
his or her right to the survivor annuity.
    5. Section 1650.19 is revised to read as follows:


Sec. 1650.19  Spouse's waiver of survivor annuity.

    (a) The right of the spouse to a survivor annuity may be waived in 
writing by the spouse on the appropriate TSP form.
    (b) When required by the regulations in this subpart, the 
appropriate survivor annuity waiver shall be filed with the TSP Service 
Office prior to the date the participant's election of benefits is 
effective.
    6. Section 1650.20 is amended by revising paragraph (a) to read as 
follows:


Sec. 1650.20  Notice to spouse.

    (a) Wherever in the regulations in this subpart it is required that 
the Executive Director provide notice of an action affecting a 
participant's account to the spouse of a participant prior to taking 
the action, such requirements may be satisfied by the TSP Service 
Office's sending a notice describing the action by first class mail to 
the last address of the spouse on file with the Plan.
* * * * *
    7. Section 1650.21 is revised to read as follows:


Sec. 1650.21  Executive Director's exception to requirement to notify 
the spouse.

    Whenever in the regulations in this subpart it is required that the 
Executive Director give notice of an action to the spouse of a 
participant, an exception to this requirement may be granted in cases 
in which the participant establishes to the satisfaction of the 
Executive Director that the spouse's whereabouts cannot be determined. 
A request for an exception based on whereabouts unknown must be 
submitted to the Executive Director on the appropriate TSP form 
accompanied by either--
    (a) A judicial determination (court order) which states that the 
spouse's whereabouts cannot be determined; or
    (b) A police or Governmental agency determination that is signed by 
the appropriate department or division head which states that the 
spouse's whereabouts cannot be determined; or
    (c) Statements by the participant and two other persons. Each 
statement must be signed and dated and must state the following: I 
understand that a false statement or willful misrepresentation is 
punishable under Federal Law (18 U.S.C. 1001) by a fine or imprisonment 
or both.
    (1) The participant's statement must give the full name of his or 
her spouse, declare the inability to locate the spouse, and state the 
efforts made to locate the spouse. Negative statements such as ``I have 
not seen or heard from him/her'' or ``I have had no contact with him/
her'' are not sufficient. Examples of attempting to locate the spouse 
include checking with relatives and mutual friends or using telephone 
directories or directory assistance for the city of last known address.
    (2) The statements from two other persons must support the 
participant's statement that the participant does not know the 
whereabouts of his or her spouse.
    (d) A withdrawal election received within one year of an approved 
exception may be processed so long as the spouse named on the form is 
the spouse for whom the exception has been approved.
    (e) The requirements for establishing an exception for a withdrawal 
and the one-year period of validity of an approved exception apply to 
exceptions for loans under 5 CFR 1655.18.
    8. Section 1650.22 is revised to read as follows:


Sec. 1650.22  Executive Director's exception to the requirement to 
obtain the spouse's signature.

    Wherever in the regulations in this subpart the spouse's signature 
is required, the Executive Director may grant an exception to this 
requirement if the participant can show that:
    (a) The spouse's whereabouts cannot be determined in accordance 
with the provisions of Sec. 1650.21; or
    (b) Due to exceptional circumstances, requiring the spouse's 
signature would otherwise be inappropriate.
    (1) An exception to the spousal signature requirement may be 
granted based on exceptional circumstances only when the participant 
presents a judicial determination (court order) or a governmental 
agency determination signed by the appropriate department or division 
head. A court order or a determination must contain a finding or a 
recitation of such exceptional circumstances regarding the spouse as 
would warrant an exception to the signature requirement.
    (2) Exceptional circumstances is narrowly construed and includes 
such circumstances as when a court order:
    (i) Indicates that the spouse and the participant have been 
maintaining separate residences with no financial relationship for 
three or more years;
    (ii) Indicates that the spouse abandoned the participant but, for 
religious or similarly compelling reasons, the parties chose not to 
divorce; or
    (iii) Expressly states that the participant may obtain a loan from 
his or her Thrift Savings Plan account or withdraw his or her thrift 
Savings Plan account balance notwithstanding the absence of the 
spouse's signature.
    (c) A withdrawal election received within one year of an approved 
exception may be processed so long as the spouse named on the form is 
the spouse for whom the exception has been approved.
    (d) The requirements for establishing an exception for a withdrawal 
and the one-year period of validity of an approved exception apply to 
exceptions for loans under 5 CFR 1655.18.

[FR Doc. 94-22482 Filed 9-12-94; 8:45 am]
BILLING CODE 6760-01-M