Mississippi Advisory Opinions December 20, 1989: 19891220 (December 20, 1989)

Advisory Opinion Text

Mr. Fred M. Walker

Exec. Secretary

Public Employees' Retirement System

429 Mississippi Street

Jackson, Mississippi 39201

Dear Mr. Walker:

The Office of the Attorney General has received your letter of request for an opinion relating to elections as to the withdrawal of Deferred Compensation funds by participants who have retired or left state service. The request has been assigned to me for research and reply. A copy of your request is attached to this response for convenient reference.

Although Section 25–14–1 et seq. is the body of state law which governs the Government Employees Deferred Compensation Plan, compliance at the federal level is also necessary. Deferred Compensation Plans of this nature are established pursuant to Section 457 of the Internal Revenue Code, and strict compliance with such is required in order for a Plan to maintain its federal tax exempt status.

Based on the foregoing, it is the opinion of the Office of the Attorney General that the Retirement System must comply with the default payout provision found in the plan document and Section 457 of the Internal Revenue Code . Whether failure to comply with such provision would endanger the Plan's federal tax exemption is that only the Internal Revenue Service can conclusively answer.

If this office can further assist you, do not hesitate to contact us.

Very truly yours,

Mike Moore, Attorney General.