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Enrolled HB 135: Establishing a Roth contribution program for the public employees' deferred compensation program; and providing for an effective date.

00 Enrolled HB 135                                                                                                         
01 Establishing a Roth contribution program for the public employees' deferred compensation                                
02 program; and providing for an effective date.                                                                           
03                           _______________                                                                               
04    * Section 1.  AS 39.45.050 is repealed and reenacted to read:                                                    
05            Sec. 39.45.050. Tax deferred investments. (a) The administrator of a deferred                              
06       compensation program under this chapter shall invest in contracts that                                            
07                 (1)  allow for deferment of state and federal income tax until benefits                                 
08       are received under the program; and                                                                               
09                 (2)  do not provide for deferral of state and federal income tax until the                              
10       benefits are received under the program.                                                                          
11            (b)  A participating employer may designate that employee contributions                                      
12       consist of deferred tax contributions, Roth contributions, or both. In the absence of an                          
13       affirmative election to make Roth contributions, an employee's contribution shall be                              
14       considered to consist entirely of deferred tax contributions.                                                     
01            (c)  Contributions made on behalf of a participating employee for any calendar                               
02       year, whether deferred tax contributions or Roth contributions, shall not exceed the                              
03       dollar limitation set out in 26 U.S.C. 402(g) (Internal Revenue Code) in effect for the                           
04       calendar year, subject to the provisions of 26 U.S.C. 414(v) (Internal Revenue Code).                             
05       Contribution amounts in excess of the applicable dollar limits shall be distributed to                            
06       the participant not later than April 15 after the close of the plan year to which the                             
07       excess contribution relates. To the extent that a participating employee's contributions                          
08       are reduced or returned to comply with the limitations of the plan, and the participant                           
09       has allocated the contributions between deferred tax contributions and Roth                                       
10       contributions, the amount of the reduction or return shall be taken first from deferred                           
11       tax contributions, to the extent of the contributions for the plan year, and, only after                          
12       the reduction or return of all the deferred tax contributions, from Roth contributions                            
13       for the plan year.                                                                                                
14            (d)  Deferred tax contributions made on behalf of a participating employee for                               
15       a plan year shall be allocated to the deferred tax contribution account of the                                    
16       participating employee, as determined by the administrator.                                                       
17            (e)  Roth contributions made on behalf of a participating employee for a plan                                
18       year shall be allocated to the Roth contribution account of the participating employee,                           
19       as determined by the administrator.                                                                               
20            (f)  The administrator may establish additional rules and procedures governing                               
21       the manner and timing of elections by participating employees to make or change the                               
22       deferred tax contribution or Roth contribution election, as needed for compliance with                            
23       federal and state law and as needed for efficiency and effectiveness of plan                                      
24       administration.                                                                                                   
25    * Sec 2. AS 39.45.060 is amended by adding a new paragraph to read:                                                
26                 (3)  "Roth contribution" means a contribution under 26 U.S.C. 402A(c)                                   
27       (Internal Revenue Code).                                                                                          
28    * Sec. 3. This Act takes effect July 1, 2015.