Sec. 7.2. (a) This section applies to the following:

(1) A member of the Indiana state teachers' retirement fund after June 30, 2007.

(2) A member of the public employees' retirement fund after June 30, 2008.

(b) Except as otherwise provided in this section, if a member is receiving a benefit from the fund, the member may make the election described in subsection (c) any number of times.

(c) Except as otherwise provided in this section, a member may elect to:

(1) change the member's designated beneficiary or form of benefit under section 7(b) of this chapter; and

(2) receive an actuarially adjusted and recalculated benefit for the remainder of:

(A) the member's life; or

(B) the member's life and the life of the newly designated beneficiary.

(d) A member making the election under subsection (c) may not elect to change to a five (5) year guaranteed form of benefit under section 7(b) of this chapter.

(e) If a member elects a benefit under subsection (c)(2)(B), the member must indicate whether the newly designated beneficiary's benefit will equal:

(1) the member's full recalculated benefit;

(2) two-thirds (2/3) of the member's recalculated benefit; or

(3) one-half (1/2) of the member's recalculated benefit.

(f) The member bears the cost of recalculating a benefit under subsection (c)(2), and the member shall pay the cost in the manner prescribed by the board by rule. However, the board shall waive the cost associated with the first time after June 30, 2016, the member changes the member's designated beneficiary or form of benefit under this section.

(g) A member may not make the election under subsection (c) if a final order or property settlement in an action for dissolution of marriage:

(1) prohibits a change in the member's designated beneficiary; or

(2) provides a right to a survivor benefit to a person who would be removed as the designated beneficiary.

(h) Benefits may be recalculated under this section only to the extent permitted by the Internal Revenue Code and applicable regulations.

(i) Before implementing this section, the board may obtain any approvals that the board considers necessary or appropriate from the Internal Revenue Service.

(j) Subject to subsection (g), if a member is receiving a benefit from the fund and the member's spouse is the member's designated beneficiary, the member may not change the member's designated beneficiary or elect to receive an actuarially adjusted and recalculated benefit under subsection (c) unless:

(1) the member's designated beneficiary dies;

(2) the member and the member's designated beneficiary have been parties in an action for dissolution of marriage in which a final order has been issued after the member's first benefit payment is made; or

(3) the member's designated beneficiary, or the guardian of the member's designated beneficiary, authorizes the change in writing in the manner prescribed by the board.

With respect to a final order for dissolution of marriage described in subdivision (2), it is immaterial whether the final order was issued before, on, or after the date in subsection (a)(1) or (a)(2).

As added by P.L.149-2007, SEC.2. Amended by P.L.9-2008, SEC.1; P.L.93-2008, SEC.2; P.L.241-2015, SEC.9; P.L.193-2016, SEC.12.