Common use of SPECIAL RULES AND OPTIONS Clause in Contracts

SPECIAL RULES AND OPTIONS. If your payment includes after-tax contributions After-tax contributions included in a payment are not taxed. If a payment is only part of your benefit, an allocable portion of your after-tax contributions is generally included in the payment. If you have pre-1987 after-tax contributions maintained in a separate account, a special rule may apply to determine whether the after-tax contributions are included in a payment. You may roll over to an IRA a payment that includes after-tax contributions through either a direct rollover or a 60-day rollover. You must keep track of the aggregate amount of the after-tax contributions in all of your IRAs (in order to determine your taxable income for later payments from the IRAs). If you do a direct rollover of only a portion of the amount paid from the Plan and a portion is paid to you, you can decide whether you want to rollover your after tax portion or have it paid directly to you as a cash distribution. If you do a 60-day rollover to an IRA of only a portion of the payment made to you, the after-tax contributions are treated as rolled over last. For example, assume you are receiving a complete distribution of your benefit which totals $12,000, of which $2,000 is after-tax contributions. In this case, if you roll over $10,000 to an IRA in a 60-day rollover, no amount is taxable because the $2,000 amount not rolled over is treated as being after-tax contributions. You may roll over to an employer plan all of a payment that includes after-tax contributions, but only through a direct rollover (and only if the receiving plan separately accounts for after-tax contributions and is not a governmental section 457(b) plan). You can do a 60-day rollover to an employer plan of part of a payment that includes after-tax contributions, but only up to the amount of the payment that would be taxable if not rolled over. If you miss the 60-day rollover deadline Generally, the 60-day rollover deadline cannot be extended. However, the IRS has the limited authority to waive the deadline under certain extraordinary circumstances, such as when external events prevented you from completing the rollover by the 60- day rollover deadline. To apply for a waiver, you must file a private letter ruling request with the IRS. Private letter ruling requests require the payment of a nonrefundable user fee. For more information, see IRS Publication 590, Individual Retirement Arrangements (IRAs). If your payment includes employer stock that you do not roll over If you do not do a rollover, you can apply a special rule to payments of employer stock (or other employer securities) that are either attributable to after-tax contributions or paid in a lump sum after separation from service (or after age 59 1/2, disability, or the participant's death). Under the special rule, the net unrealized appreciation on the stock will not be taxed when distributed from the Plan and will be taxed at capital gain rates when you sell the Stock. Net unrealized appreciation is generally the increase in the value of employer stock after it was acquired by the Plan. If you do a rollover for a payment that includes employer stock (for example, by selling the stock and rolling over the proceeds within 60 days of the payment), the special rule relating to the distributed employer stock will not apply to any subsequent payments from the IRA or employer plan. The Plan administrator can tell you the amount of any net unrealized appreciation. If you have an outstanding loan that Is being offset If you have an outstanding loan from the Plan, your Plan benefit may be offset by the amount of the loan, typically when your employment ends. The loan offset amount is treated as a distribution to you at the time of the offset and will be taxed (including the 10% additional income tax on early distributions, unless an exception applies) unless you do a 60-day rollover in the amount of the loan offset to an IRA or employer plan. If you were born on or before January 1, 1936 If you were born on or before January 1, 1936 and receive a lump sum distribution that you do not roll over, special rules for calculating the amount of the tax on the payment might apply to you. For more information, see IRS Publication 575, Pension and Annuity Income. If your payment is from a governmental section 457(b) plans If the Plan is a governmental section 457(b) plan, the same rules described elsewhere in this notice generally apply, allowing you to roll over the payment to an IRA or an employer plan that accepts rollovers. One difference is that, if you do not do a rollover, you will not have to pay the 10% additional income tax on early distributions from the Plan even if you are under age 59 1/2 (unless the payment is from a separate account holding rollover contributions that were made to the Plan from a tax-qualified plan, a section 403(b) plan, or an IRA). However, if you do a rollover to an IRA or to an employer plan that is not a governmental section 457(b) plan, a later distribution made before age 59 1/2 will be subject to the 10% additional income tax on early distributions (unless an exception applies). Other differences are that you cannot do a rollover if the payment is due to an "unforeseeable emergency" and the special rules under if your payment includes employer stock that you do not roll over" and "If you were born on or before January 1, 1936" do not apply. If you are an eligible retired public safety officer and your pension payment is used to pay for health coverage or qualified long-term care insurance If the Plan is a governmental plan, you retired as a public safety officer, and your retirement was by reason of disability or was after normal retirement age, you can exclude from your taxable income plan payments paid directly as premiums to an accident or health plan (or a qualified long-term care insurance contract) that your employer maintains for you, your spouse, or your dependents, up to a maximum of $3,000 annually. For this purpose, a public safety officer is a law enforcement officer, firefighter, chaplain, or member of a rescue squad or ambulance crew. If you roll over your payment to a Xxxx XXX You can roll over a payment from the Plan made before January 1, 2010 to a Xxxx XXX only if your modified adjusted gross income is not more than $100,000 for the year the payment is made to you and, if married, you file a joint return. These limitations do not apply to payments made to you from the Plan after 2009. If you wish to roll over the payment to a Xxxx XXX, but you are not eligible to do a rollover to a Xxxx XXX until after 2009, you can do a rollover to a traditional IRA and then, after 2009, elect to convert the traditional IRA into a Xxxx XXX. If you roll over the payment to a Xxxx XXX, a special rule applies under which the amount of the payment rolled over (reduced by any after-tax amounts) will be taxed. However, the 10% additional income tax on early distributions will not apply (unless you take the amount rolled over out of the Xxxx XXX within 5 years, counting from January 1 of the year of the rollover). For payments from the Plan during 2010 that are rolled over to a Xxxx XXX, the taxable amount can be spread over a 2-year period starting in 2011. If you roll over the payment to a Xxxx XXX, later payments from the Xxxx XXX that are qualified distributions will not be taxed (including earnings after the rollover). A qualified distribution from a Xxxx XXX is a payment made after you are age 59 1/2 (or after your death or disability, or as a qualified first-time homebuyer distribution of up to $10,000) and after you have had a Xxxx XXX for at least 5 years. In applying this 5-year rule, you count from January 1 of the year for which your first contribution was made to a Xxxx XXX. Payments from the Xxxx XXX that are not qualified distributions will be taxed to the extent of earnings after the rollover, including the 10% additional income tax on early distributions (unless an exception applies). You do not have to take required minimum distributions from a Xxxx XXX during your lifetime. For more information, see IRS Publication 590, Individual Retirement Arrangements (IRAs). You cannot roll over a payment from the Plan to a designated Xxxx account in an employer plan. If you are not a plan participant Payments after death of the participant. If you receive a distribution after the participant's death that you do not roll over, the distribution will generally be taxed in the same manner described elsewhere in this notice. However, the 10% additional income tax on early distributions and the special rules for public safety officers do not apply, and the special rule described under the section "If you were born on or before January 1, 1936" applies only if the participant was born on or before January 1, 1936. If you are a surviving spouse: If you receive a payment from the Plan as the surviving spouse of a deceased participant, you have the same rollover options that the participant would have had, as described elsewhere in this notice. In addition, if you choose to do a rollover to an IRA, you may treat the IRA as your own or as an inherited IRA. An IRA you treat as your own is treated like any other IRA of yours, so that payments made to you before you are age 59 1/2 will be subject to the 10% additional income tax on early distributions (unless an exception applies) and required minimum distributions from your IRA do not have to start until after you are age 70 ½ . If you treat the IRA as an inherited IRA, payments from the IRA will not be subject to the 10% additional income tax on early distributions. However, if the participant had started taking required minimum distributions, you will have to receive required minimum distributions from the inherited IRA. If the participant had not started taking required minimum distributions from the Plan, you will not have to start receiving required minimum distributions from the inherited IRA until the year the participant would have been age 70 ½. If you are a surviving beneficiary other than a spouse: If you receive a payment from the Plan because of the participant’s death and you are a designated beneficiary other than a surviving spouse, the only rollover option you have is to do a direct rollover to an inherited IRA. Payments from the inherited IRA will not be subject to the 10% additional income tax on early distributions. You will have to receive required minimum distributions from the inherited IRA. Payments under a qualified domestic relations order. If you are the spouse or former spouse of the participant who receives a payment from the Plan under a qualified domestic relations order (QDRO), you generally have the same options the participant would have (for example, you may roll over the payment to your own IRA or an eligible employer plan that will accept it). Payments under the QDRO will not be subject to the 10% additional income tax on early distributions. If you are a nonresident alien If you are a nonresident alien and you do not do a direct rollover to a U.S. IRA or U.S. employer plan, instead of withholding 20%, the Plan is generally required to withhold 30% of the payment for federal income taxes. If the amount withheld exceeds the amount of tax you owe (as may happen if you do a 60-day rollover), you may request an income tax refund by filing Form 1040NR and attaching your Form 1042-S. See Form W-8BEN for claiming that you are entitled to a reduced rate of withholding under an income tax treaty. For more information, see also IRS Publication 519, U.S. Tax Guide for Aliens, and IRS Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities. Other special rules If a payment is one in a series of payments for less than 10 years, your choice whether to make a direct rollover will apply to all later payments in the series (unless you make a different choice for later payments). If your payments for the year are less than $200 (not including payments from a designated Xxxx account in the Plan), the Plan is not required to allow you to do a direct rollover and is not required to withhold for federal income taxes. However, you may do a 60-day rollover. Unless you elect otherwise, if your plan's cashout limit is greater than $1,000, a mandatory cashout of more than $1,000 (not including payments from a designated Xxxx account in the Plan) will be directly rolled over to an IRA chosen by the Plan administrator or the payor. A mandatory cashout is a payment from a plan to a participant made before age 62 (or normal retirement age, if later) and without consent, where the participant's benefit does not exceed the plan's defined cashout limit (not in excess of $5,000 (may or may not include any amounts held under the plan as a result of a prior rollover made to the plan)).

SPECIAL RULES AND OPTIONS. If your payment includes after-tax contributions After-tax contributions included in a payment are not taxed. If you receive a partial payment is only part of for your total benefit, an allocable portion of your after-tax contributions is generally included in the payment. If , so you have pre-1987 cannot take a payment of only after-tax contributions contributions. However, if you have prre-1987 after-tax contribu- tions maintained in a separate account, a special rule may apply to determine whether the after-tax contributions are included in the payment. In addition, special rules apply when you do a paymentrollover, as described below. You may roll over to an IRA a payment that includes after-tax contributions through either a direct rollover or a 60-day rollover. You must keep track of the aggregate amount of the after-tax contributions in all of your IRAs (in order to determine your taxable income for later payments from the IRAs). If you do a direct rollover of only a portion of the amount paid from the Plan and a portion at the same time the rest is paid to you, the portion rolled over consists first of the amount that would be taxable if not rolled over. For example, assume you are receiving a distribution of $12,000, of which $2,000 is after-tax contribu- tions. In this case, if you directly roll over $10,000 to an IRA that is not a Xxxx XXX, no amount is taxable because the $2,000 amount not directly rolled over is treated as being after-tax contributions. If you do a direct rollover of the en- tire amount paid from the Plan to two or more destinations at the same time, you can decide whether you want to rollover your after choose which destination receives the after-tax portion or have it paid directly to you as a cash distributioncontributions. If Similarly, if you do a 60-day rollover to an IRA of only a portion of the a payment made to you, the after-tax contributions are treated as portion rolled over lastconsists first of the amount that would be taxable if not rolled over. For example, assume you are receiving a complete distribution distribu- tion of your benefit which totals $12,000, of which $2,000 is after-tax contributions, and no part of the distribution is directly rolled over. In this case, if you roll over $10,000 to an IRA that is no a Xxxx XXX in a 60-day rollover, no amount is taxable because the $2,000 amount not rolled over is treated as being after-tax contributions. Once you roll over your after-tax contributions to a traditional IRA, those amounts CANNOT later be rolled over to an employer plan. You may roll over to an employer plan all of a payment that includes after-tax contributions, but only through a direct rollover (and only if the receiving plan separately accounts for after-tax contributions and is not a governmental section sec- tion 457(b) plan). You can do a 60-day rollover to an employer plan of part of a payment that includes after-tax contributions, but only up to the amount of the payment that would be taxable if not rolled over. If you miss the 60-day rollover deadline Generally, the 60-day rollover deadline cannot be extended. However, the IRS has the limited authority to waive the deadline under certain extraordinary extraor- dinary circumstances, such as when external events prevented you from completing the rollover by the 60- 60-day rollover deadline. To Under certain circum- stances, you may claim eligibility for a waiver of the 60-day rollover deadline by making a written self-certification. Otherwise, to apply for a waiverwaiver from the IRS, you must file a private letter ruling request with the IRS. Private letter ruling requests require the a payment of a nonrefundable user fee. For more informationin- formation, see IRS Publication 590-A, Contributions to Individual Retirement Arrangements (IRAs). If your payment includes employer stock that you do not roll over If you do not do a rollover, you can apply a special rule to payments of employer stock (or other employer securities) that are either attributable to after-tax contributions or paid in a lump sum after separation from service (or after age 59 1/259½, disability, or the participant's ’s death). Under the special rule, the net unrealized appreciation on the stock will not be taxed when distributed from the Plan and will be taxed at capital gain rates when you sell the Stockstock. Net unrealized appreciation is generally the increase in the value of employer stock after it was acquired by the Plan. If you do a rollover for a payment that includes employer stock (for example, by selling the stock and rolling over the proceeds within 60 days of the payment), the special rule relating to the distributed employer stock will not apply to any subsequent payments from the IRA or employer plangenerally the Plan. The Plan administrator can tell you the amount of any net unrealized appreciation. If you have an outstanding loan that Is is being offset If you have an outstanding loan from the Plan, your Plan benefit may be offset by the outstanding amount of the loan, typically when your employment ends. The loan offset amount is treated as a distribution to you at the time of the offset. Generally, you may roll over all or any portion of the offset and amount. Any offset amount that is not rolled over will be taxed (including the 10% additional income tax on early distributions, unless an exception applies) unless you do a 60-day rollover in the amount of the loan ). You may roll over offset amounts to an IRA or an employer planplan (if the terms of the employer plan permit the plan to receive plan loan offset rollovers). How long you have to complete the rollover depends on what kind of plan loan offset you have. If you have a qualified plan loan offset, you will have until your tax return due date (including extensions) for the tax year during which the offset occurs to complete your rollover. A qualified plan loan offset occurs when a plan loan in good standing is offset because your employer plan terminates, or because you sever from employment. If you plan loan offset occurs for any other reason (such as failure to make level loan repay- ments that results in a deemed distribution), then you have 60 days from the date of the offset occurs to complete your rollover. If you were born on or before January 1, 1936 If you were born on or before January 1, 1936 and receive a lump sum distribution that you do not roll over, special rules for calculating the amount of the tax on the payment might apply to you. For more information, see IRS Publication 575, Pension and Annuity Income. If your payment is from a governmental section 457(b) plans plan If the Plan is a governmental section 457(b) plan, the same rules described elsewhere in this notice generally apply, allowing you to roll over the payment to an IRA or an employer plan that accepts rollovers. One difference is that, if you do not do a rollover, you will not have to pay the 10% additional income tax on early distributions from the Plan even if you are under age 59 1/2 59½ (unless the payment is from a separate account holding rollover contributions that were made to the Plan from a tax-qualified plan, a section 403(b) plan, or an IRA). However, if you do a rollover to an IRA or to an employer plan that is not a governmental section 457(b) plan, a later distribution made before age 59 1/2 59½ will be subject to the 10% additional income tax on early distributions (unless an exception applies). Other differences are include that you cannot do a rollover if the payment is due to an "unforeseeable emergency" and the special rules under if "If your payment includes employer stock that you do not roll over" and "If you were born on or before January 1, 1936" do not apply. If you are an eligible retired public safety officer and your pension payment is used to pay for health coverage or qualified long-term care insurance If the Plan is a governmental plan, you retired as a public safety officer, and your retirement was by reason of disability or was after normal retirement age, you can exclude from your taxable income plan Plan payments paid directly as premiums to an accident or health plan (or a qualified long-term care insurance in- surance contract) that your employer maintains for you, your spouse, spouse or your dependentsdependants, up to a maximum of $3,000 annually. For this purpose, a public safety officer is a law enforcement officer, firefighter, chaplain, or member of a rescue squad or ambulance crew. If you roll over your payment to a Xxxx XXX You can If you roll over a payment from the Plan made before January 1, 2010 to a Xxxx XXX only if your modified adjusted gross income is not more than $100,000 for the year the payment is made to you and, if married, you file a joint return. These limitations do not apply to payments made to you from the Plan after 2009. If you wish to roll over the payment to a Xxxx XXX, but you are not eligible to do a rollover to a Xxxx XXX until after 2009, you can do a rollover to a traditional IRA and then, after 2009, elect to convert the traditional IRA into a Xxxx XXX. If you roll over the payment to a Xxxx XXX, a special rule applies under which the amount of the payment rolled over (reduced by any after-tax amounts) will be taxed. HoweverIn general, the 10% additional income tax on early distributions will not apply (unless apply. However, if you take the amount rolled over out of the Xxxx XXX within 5 years, counting from the 5-year period that begins on January 1 of the year of the rollover). For payments from the Plan during 2010 that are rolled over to a Xxxx XXX, the taxable amount can be spread over a 2-year period starting in 201110% additional income tax will apply (unless an exception applies). If you roll over the payment to a Xxxx XXX, later payments from the Xxxx XXX that are qualified distributions will not be taxed (including earnings after the rollover). A qualified distribution from a Xxxx XXX is a payment made after you are age 59 1/2 59½ (or after your death or disability, or as a qualified first-time homebuyer distribution of up to $10,000) and after you have had a Xxxx XXX for at least 5 years. In applying this 5-year rule, you count from January 1 of the year for which your first contribution was made to a Xxxx XXX. Payments from the Xxxx XXX that are not qualified distributions will be taxed to the extent of earnings after the rollover, including the 10% additional income tax on early distributions (unless an exception applies). You do not have to take required minimum distributions from a Xxxx XXX during your lifetime. For more information, see IRS Publication 590-A, Contributions to Individual Retire- ment Arrangements (IRAs), and IRS Publication 590-B, Distributions from Individual Retirement Arrangements (IRAs). If you do a rollover to a designated Xxxx account in the Plan You cannot roll over a distribution to a designated Xxxx account in another employer's plan. However, you can roll the distribution over into a designated Xxxx account in the distributing Plan. If you roll over a payment from the Plan to a designated Xxxx account in the Plan, the amount of the payment rolled over (reduced by any after-tax amounts directly rolled over) will be taxed. In general, the 10% additional income tax on early distributions will not apply. However, if you take the amount rolled over out of the Xxxx XXX within the 5-year period that begins on January 1 of the year of the rollover, the 10% additional income tax will apply (unless an employer exception applies). If you roll over the payment to a designated Xxxx account in the plan, later payments from the designated Xxxx account that are qualified distributions will not be taxed (including earnings after the rollover). A qualified distribution from a designated Xxxx account is a payment made both after you attain age 59½ (or after your death or disability) and after you have had a designated Xxxx account in the plan for a period of at least 5 years. In applying this 5-year rule, you count from January 1 of the year your first contribution was made to the designated Xxxx account. However, if you made a direct rollover to a designated Xxxx account in the plan from a designated Xxxx account in a plan of another employer, the 5-year period begins on January 1 of the year your first contribution was made to the designated Xxxx account in the plan or, if earlier, to the designated Xxxx account in the plan of the other employer. Payments from the designated Xxxx account that are not qualified distributions will be taxed to the extent allocable to earnings after the rollover, including the 10% additional tax on early distributions (unless an exception applies). If you are not a plan Plan participant Payments after death of the participant. If you receive a distribution after the participant's ’s death that you do not roll over, the distribution generally will generally be taxed in the same manner described elsewhere in this notice. However, the 10% additional income tax on early distributions and the special rules for public safety officers do not apply, and the special rule described under the section "“If you were born on or before January 1, 1936" ” applies only if the deceased participant was born on or before January 1, 1936. If you are a surviving spouse: spouse If you receive a payment from the Plan as the surviving spouse of a deceased de- ceased participant, you have the same rollover options that the participant would have had, as described elsewhere in this notice. In addition, if you choose to do a rollover to an IRA, you may treat the IRA as your own or as an inherited IRA. An IRA you treat as your own is treated like any other IRA of yours, so that payments made to you before you are age 59 1/2 59½ will be subject to the 10% additional income tax on early distributions (unless an exception applies) and required minimum distributions from your IRA do not have to start until after you are age 70 ½ 70½ if you were born before July 1, 1949, or age 72 if you were born after June 30, 1949. If you treat the IRA as an inherited IRA, payments from the IRA will not be subject to the 10% additional income tax on early distributions. However, if the participant had started taking required minimum distributions, you will have to receive required minimum distributions from the inherited IRA. If the participant had not started taking required minimum distributions from the Plan, you will not have to start receiving required minimum distributions distribu- tions from the inherited IRA until the year the participant would have been age 70 ½. 70½ if the participant was born before July 1, 1949, or age 72 if the participant was born after June 30, 1949. If you are a surviving beneficiary other than a spouse: spouse If you receive a payment from the Plan because of the participant’s death and you are a designated beneficiary other than a surviving spouse, the only rollover option you have is to do a direct rollover to an inherited IRA. Payments from the inherited IRA will not be subject to the 10% additional income tax on early distributions. You will have to receive required minimum mini- mum distributions from the inherited IRA. Payments under a qualified domestic relations orderorder (QDRO). If you are the spouse or former spouse of the participant who receives a payment from the Plan under a qualified domestic relations order (QDRO), you generally have the same options and the same tax treatment that the participant would have (for example, you may roll over the payment to your own IRA Xxxx XXX or to a designated Xxxx account in an eligible employer plan that will accept it). Payments under the QDRO will not be subject to the 10% additional income tax on early distributions. If you are a nonresident alien If you are a nonresident alien and you do not do a direct rollover to a U.S. IRA or U.S. employer plan, instead of withholding 20%and the payment is not a qualified distribution, the Plan is generally required to withhold 30% (instead of withholding 20%) of the payment earnings for federal income taxes. If the amount withheld exceeds the amount of tax you owe (as may happen if you do a 60-day rollover), you may request an income tax refund by filing Form 1040NR and attaching your Form 1042-S. See Form W-8BEN for claiming that you are entitled to a reduced rate of withholding under an income tax treaty. For more information, see also IRS Publication 519, U.S. Tax Guide for Aliens, and IRS Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities. Other special rules If a payment is one in a series of payments for less than 10 years, your choice whether to make a direct rollover will apply to all later payments in the series (unless you make a different choice for later payments). If your payments for the year are less than $200 (not including payments from a designated Xxxx account in the Plan), the Plan is not required to allow you to do a direct rollover and is not required to withhold for federal income taxes. However, you may do a 60-day rollover. Unless you elect otherwise, if your plan's cashout limit is greater than $1,000, a mandatory cashout of more than $1,000 (not including payments from a designated Xxxx account in the Plan) will be directly rolled over to an IRA chosen by the Plan administrator or the payor. A mandatory cashout is a payment from a plan to a participant made before age 62 (or normal retirement age, if later) and without consent, where the participant's benefit does not exceed the plan's defined cashout limit (not in excess of $5,000 (may or may not include any amounts held under the plan as a result of a prior rollover made to the plan)).Form

SPECIAL RULES AND OPTIONS. If your payment includes after-tax contributions After-tax contributions included in a payment are not taxed. If a payment is only part of your benefit, an allocable portion of your after-tax contributions is generally included in the payment. If you have pre-1987 after-tax contributions maintained in a separate account, a special rule may apply to determine whether the after-tax contributions are included in a payment. You may roll over to an IRA a payment that includes after-tax contributions through either a direct rollover or a 60-day rollover. You must keep track of the aggregate amount of the after-tax contributions in all of your IRAs (in order to determine your taxable income for later payments from the IRAs). If you do a direct rollover of only a portion of the amount paid from the Plan and a portion is paid to you, you can decide whether you want to rollover your after tax portion or have it paid directly to you as a cash distribution. If you do a 60-day rollover to an IRA of only a portion of the payment made to you, the after-tax contributions are treated as rolled over last. For example, assume you are receiving a complete distribution of your benefit which totals $12,000, of which $2,000 is after-tax contributions. In this case, if you roll over $10,000 to an IRA in a 60-day rollover, no amount is taxable because the $2,000 amount not rolled over is treated as being after-tax contributions. You may roll over to an employer plan all of a payment that includes after-tax contributions, but only through a direct rollover (and only if the receiving plan separately accounts for after-tax contributions and is not a governmental section 457(b) plan). You can do a 60-day rollover to an employer plan of part of a payment that includes after-tax contributions, but only up to the amount of the payment that would be taxable if not rolled over. If you miss the 60-day rollover deadline Generally, the 60-day rollover deadline cannot be extended. However, the IRS has the limited authority to waive the deadline under certain extraordinary circumstances, such as when external events prevented you from completing the rollover by the 60- 60-day rollover deadline. To apply for a waiver, you must file a private letter ruling request with the IRS. Private letter ruling requests require the payment of a nonrefundable user fee. For more information, see IRS Publication 590, Individual Retirement Arrangements (IRAs). If your payment includes employer stock that you do not roll over If you do not do a rollover, you can apply a special rule to payments of employer stock (or other employer securities) that are either attributable to after-tax contributions or paid in a lump sum after separation from service (or after age 59 1/2, disability, or the participant's death). Under the special rule, the net unrealized appreciation on the stock will not be taxed when distributed from the Plan and will be taxed at capital gain rates when you sell the Stock. Net unrealized appreciation is generally the increase in the value of employer stock after it was acquired by the Plan. If you do a rollover for a payment that includes employer stock (for example, by selling the stock and rolling over the proceeds within 60 days of the payment), the special rule relating to the distributed employer stock will not apply to any subsequent payments from the IRA or employer plan. The Plan administrator can tell you the amount of any net unrealized appreciation. If you have an outstanding loan that Is being offset If you have an outstanding loan from the Plan, your Plan benefit may be offset by the amount of the loan, typically when your employment ends. The loan offset amount is treated as a distribution to you at the time of the offset and will be taxed (including the 10% additional income tax on early distributions, unless an exception applies) unless you do a 60-day rollover in the amount of the loan offset to an IRA or employer plan. If you were born on or before January 1, 1936 If you were born on or before January 1, 1936 and receive a lump sum distribution that you do not roll over, special rules for calculating the amount of the tax on the payment might apply to you. For more information, see IRS Publication 575, Pension and Annuity Income. If your payment is from a governmental section 457(b) plans If the Plan is a governmental section 457(b) plan, the same rules described elsewhere in this notice generally apply, allowing you to roll over the payment to an IRA or an employer plan that accepts rollovers. One difference is that, if you do not do a rollover, you will not have to pay the 10% additional income tax on early distributions from the Plan even if you are under age 59 1/2 (unless the payment is from a separate account holding rollover contributions that were made to the Plan from a tax-qualified plan, a section 403(b) plan, or an IRA). However, if you do a rollover to an IRA or to an employer plan that is not a governmental section 457(b) plan, a later distribution made before age 59 1/2 will be subject to the 10% additional income tax on early distributions (unless an exception applies). Other differences are that you cannot do a rollover if the payment is due to an "unforeseeable emergency" and the special rules under if your payment includes employer stock that you do not roll over" and "If you were born on or before January 1, 1936" do not apply. If you are an eligible retired public safety officer and your pension payment is used to pay for health coverage or qualified long-term care insurance If the Plan is a governmental plan, you retired as a public safety officer, and your retirement was by reason of disability or was after normal retirement age, you can exclude from your taxable income plan payments paid directly as premiums to an accident or health plan (or a qualified long-term care insurance contract) that your employer maintains for you, your spouse, or your dependents, up to a maximum of $3,000 annually. For this purpose, a public safety officer is a law enforcement officer, firefighter, chaplain, or member of a rescue squad or ambulance crew. If you roll over your payment to a Xxxx XXX You can roll over a payment from the Plan made before January 1, 2010 to a Xxxx XXX only if your modified adjusted gross income is not more than $100,000 for the year the payment is made to you and, if married, you file a joint return. These limitations do not apply to payments made to you from the Plan after 2009. If you wish to roll over the payment to a Xxxx XXX, but you are not eligible to do a rollover to a Xxxx XXX until after 2009, you can do a rollover to a traditional IRA and then, after 2009, elect to convert the traditional IRA into a Xxxx XXX. If you roll over the payment to a Xxxx XXX, a special rule applies under which the amount of the payment rolled over (reduced by any after-tax amounts) will be taxed. However, the 10% additional income tax on early distributions will not apply (unless you take the amount rolled over out of the Xxxx XXX within 5 years, counting from January 1 of the year of the rollover). For payments from the Plan during 2010 that are rolled over to a Xxxx XXX, the taxable amount can be spread over a 2-year period starting in 2011. If you roll over the payment to a Xxxx XXX, later payments from the Xxxx XXX that are qualified distributions will not be taxed (including earnings after the rollover). A qualified distribution from a Xxxx XXX is a payment made after you are age 59 1/2 (or after your death or disability, or as a qualified first-time homebuyer distribution of up to $10,000) and after you have had a Xxxx XXX for at least 5 years. In applying this 5-year rule, you count from January 1 of the year for which your first contribution was made to a Xxxx XXX. Payments from the Xxxx XXX that are not qualified distributions will be taxed to the extent of earnings after the rollover, including the 10% additional income tax on early distributions (unless an exception applies). You do not have to take required minimum distributions from a Xxxx XXX during your lifetime. For more information, see IRS Publication 590, Individual Retirement Arrangements (IRAs). You cannot roll over a payment from the Plan to a designated Xxxx account in an employer plan. If you are not a plan participant Payments after death of the participant. If you receive a distribution after the participant's death that you do not roll over, the distribution will generally be taxed in the same manner described elsewhere in this notice. However, the 10% additional income tax on early distributions and the special rules for public safety officers do not apply, and the special rule described under the section "If you were born on or before January 1, 1936" applies only if the participant was born on or before January 1, 1936. . If you are a surviving spouse: . If you receive a payment from the Plan as the surviving spouse of a deceased participant, you have the same rollover options that the participant would have had, as described elsewhere in this notice. In addition, if you choose to do a rollover to an IRA, you may treat the IRA as your own or as an inherited IRA. An IRA you treat as your own is treated like any other IRA of yours, so that payments made to you before you are age 59 1/2 will be subject to the 10% additional income tax on early distributions (unless an exception applies) and required minimum distributions from your IRA do not have to start until after you are age 70 ½ . If you treat the IRA as an inherited IRA, payments from the IRA will not be subject to the 10% additional income tax on early distributions. However, if the participant had started taking required minimum distributions, you will have to receive required minimum distributions from the inherited IRA. If the participant had not started taking required minimum distributions from the Plan, you will not have to start receiving required minimum distributions from the inherited IRA until the year the participant would have been age 70 ½. If you are a surviving beneficiary other than a spouse: . If you receive a payment from the Plan because of the participant’s death and you are a designated beneficiary other than a surviving spouse, the only rollover option you have is to do a direct rollover to an inherited IRA. Payments from the inherited IRA will not be subject to the 10% additional income tax on early distributions. You will have to receive required minimum distributions from the inherited IRA. Payments under a qualified domestic relations order. If you are the spouse or former spouse of the participant who receives a payment from the Plan under a qualified domestic relations order (QDRO), you generally have the same options the participant would have (for example, you may roll over the payment to your own IRA or an eligible employer plan that will accept it). Payments under the QDRO will not be subject to the 10% additional income tax on early distributions. If you are a nonresident alien If you are a nonresident alien and you do not do a direct rollover to a U.S. IRA or U.S. employer plan, instead of withholding 20%, the Plan is generally required to withhold 30% of the payment for federal income taxes. If the amount withheld exceeds the amount of tax you owe (as may happen if you do a 60-day rollover), you may request an income tax refund by filing Form 1040NR and attaching your Form 1042-S. See Form W-8BEN for claiming that you are entitled to a reduced rate of withholding under an income tax treaty. For more information, see also IRS Publication 519, U.S. Tax Guide for Aliens, and IRS Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities. Other special rules If a payment is one in a series of payments for less than 10 years, your choice whether to make a direct rollover will apply to all later payments in the series (unless you make a different choice for later payments). If your payments for the year are less than $200 (not including payments from a designated Xxxx account in the Plan), the Plan is not required to allow you to do a direct rollover and is not required to withhold for federal income taxes. However, you may do a 60-day rollover. Unless you elect otherwise, if your plan's cashout limit is greater than $1,000, a mandatory cashout of more than $1,000 (not including payments from a designated Xxxx account in the Plan) will be directly rolled over to an IRA chosen by the Plan administrator or the payor. A mandatory cashout is a payment from a plan to a participant made before age 62 (or normal retirement age, if later) and without consent, where the participant's benefit does not exceed the plan's defined cashout limit (not in excess of $5,000 (may or may not include any amounts held under the plan as a result of a prior rollover made to the plan)).

SPECIAL RULES AND OPTIONS. If your payment includes after-tax contributions After-tax contributions included in a payment are not taxed. If a payment is only part of your benefit, an allocable portion of your after-tax contributions is generally included in the payment. If you have pre-1987 after-tax contributions maintained in a separate account, a special rule may apply to determine whether the after-tax contributions are included in a payment. You may roll over to an IRA XXX a payment that includes after-tax contributions through either a direct rollover or a 60-day rollover. You must keep track of the aggregate amount of the after-tax contributions in all of your IRAs (in order to determine your taxable income for later payments from the IRAs). If you do a direct rollover of only a portion of the amount paid from the Plan and a portion is paid to you, you can decide whether you want to rollover your after each of the payments will include an allocable portion of the after-tax portion or have it paid directly to you as a cash distributioncontributions. If you do a 60-day rollover to an IRA XXX of only a portion of the payment made to you, the after-tax contributions are treated as rolled over last. For example, assume you are receiving a complete distribution of your benefit which totals $12,000, of which $2,000 is after-tax contributions. In this case, if you roll over $10,000 to an IRA XXX in a 60-day rollover, no amount is taxable because the $2,000 amount not rolled over is treated as being after-tax contributions. You may roll over to an employer plan all of a payment that includes after-tax contributions, but only through a direct rollover (and only if the receiving plan separately accounts for after-tax contributions and is not a governmental section 457(b) plan). You can do a 60-day rollover to an employer plan of part of a payment that includes after-tax contributions, but only up to the amount of the payment that would be taxable if not rolled over. If you miss the 60-day rollover deadline Generally, the 60-day rollover deadline cannot be extended. However, the IRS has the limited authority to waive the deadline under certain extraordinary circumstances, such as when external events prevented you from completing the rollover by the 60- 60-day rollover deadline. To apply for a waiver, you must file a private letter ruling request with the IRS. Private letter ruling requests require the payment of a nonrefundable user fee. For more information, see IRS Publication 590, Individual Retirement Arrangements (IRAs). If your payment includes employer stock that you do not roll over If you do not do a rollover, you can apply a special rule to payments of employer stock (or other employer securities) that are either attributable to after-tax contributions or paid in a lump sum after separation from service (or after age 59 1/259½, disability, or the participant's ’s death). Under the special rule, the net unrealized appreciation on the stock will not be taxed when distributed from the Plan and will be taxed at capital gain rates when you sell the Stockstock. Net unrealized appreciation is generally the increase in the value of employer stock after it was acquired by the Plan. If you do a rollover for a payment that includes employer stock (for example, by selling the stock and rolling over the proceeds within 60 days of the payment), the special rule relating to the distributed employer stock will not apply to any subsequent payments from the IRA XXX or employer plan. The Plan administrator can tell you the amount of any net unrealized appreciation. If you have an outstanding loan that Is is being offset If you have an outstanding loan from the Plan, your Plan benefit may be offset by the amount of the loan, typically when your employment ends. The loan offset amount is treated as a distribution to you at the time of the offset and will be taxed (including the 10% additional income tax on early distributions, unless an exception applies) unless you do a 60-day rollover in the amount of the loan offset to an IRA XXX or employer plan. If you were born on or before January 1, 1936 If you were born on or before January 1, 1936 and receive a lump sum distribution that you do not roll over, special rules for calculating the amount of the tax on the payment might apply to you. For more information, see IRS Publication 575, Pension and Annuity Income. If your payment is from a governmental section 457(b) plans If the Plan is a governmental section 457(b) plan, the same rules described elsewhere in this notice generally apply, allowing you to roll over the payment to an IRA or an employer plan that accepts rollovers. One difference is that, if you do not do a rollover, you will not have to pay the 10% additional income tax on early distributions from the Plan even if you are under age 59 1/2 (unless the payment is from a separate account holding rollover contributions that were made to the Plan from a tax-qualified plan, a section 403(b) plan, or an IRA). However, if you do a rollover to an IRA or to an employer plan that is not a governmental section 457(b) plan, a later distribution made before age 59 1/2 will be subject to the 10% additional income tax on early distributions (unless an exception applies). Other differences are that you cannot do a rollover if the payment is due to an "unforeseeable emergency" and the special rules under if your payment includes employer stock that you do not roll over" and "If you were born on or before January 1, 1936" do not apply. If you are an eligible retired public safety officer and your pension payment is used to pay for health coverage or qualified long-term care insurance If the Plan is a governmental plan, you retired as a public safety officer, and your retirement was by reason of disability or was after normal retirement age, you can exclude from your taxable income plan payments paid directly as premiums to an accident or health plan (or a qualified long-term care insurance contract) that your employer maintains for you, your spouse, or your dependents, up to a maximum of $3,000 annually. For this purpose, a public safety officer is a law enforcement officer, firefighter, chaplain, or member of a rescue squad or ambulance crew. If you roll over your payment to a Xxxx XXX You can roll over a payment from the Plan made before January 1, 2010 to a Xxxx XXX only if your modified adjusted gross income is not more than $100,000 for the year the payment is made to you and, if married, you file a joint return. These limitations do not apply to payments made to you from the Plan after 2009. If you wish to roll over the payment to a Xxxx XXX, but you are not eligible to do a rollover to a Xxxx XXX until after 2009, you can do a rollover to a traditional IRA XXX and then, after 2009, elect to convert the traditional IRA XXX into a Xxxx XXX. If you roll over the payment to a Xxxx XXX, a special rule applies under which the amount of the payment rolled over (reduced by any after-tax amounts) will be taxed. However, the 10% additional income tax on early distributions will not apply (unless you take the amount rolled over out of the Xxxx XXX within 5 years, counting from January 1 of the year of the rollover). For payments from the Plan during 2010 that are rolled over to a Xxxx XXX, the taxable amount can be spread over a 2-year period starting in 2011. If you roll over the payment to a Xxxx XXX, later payments from the Xxxx XXX that are qualified distributions will not be taxed (including earnings after the rollover). A qualified distribution from a Xxxx XXX is a payment made after you are age 59 1/2 59½ (or after your death or disability, or as a qualified first-time homebuyer distribution of up to $10,000) and after you have had a Xxxx XXX for at least 5 years. In applying this 5-year rule, you count from January 1 of the year for which your first contribution was made to a Xxxx XXX. Payments from the Xxxx XXX that are not qualified distributions will be taxed to the extent of earnings after the rollover, including the 10% additional income tax on early distributions (unless an exception applies). You do not have to take required minimum distributions from a Xxxx XXX during your lifetime. For more information, see IRS Publication 590, Individual Retirement Arrangements (IRAs). You cannot roll over a payment from the Plan to a designated Xxxx account in an employer plan. If you are not a plan participant Payments after death of the participant. If you receive a distribution after the participant's ’s death that you do not roll over, the distribution will generally be taxed in the same manner described elsewhere in this notice. However, the 10% additional income tax on early distributions and the special rules for public safety officers do does not apply, and the special rule described under the section "“If you were born on or before January 1, 1936" ” applies only if the participant was born on or before January 1, 1936. If you are a surviving spouse: . If you receive a payment from the Plan as the surviving spouse of a deceased participant, you have the same rollover options that the participant would have had, as described elsewhere in this notice. In addition, if you choose to do a rollover to an IRAXXX, you may treat the IRA XXX as your own or as an inherited IRAXXX. An IRA XXX you treat as your own is treated like any other IRA XXX of yours, so that payments made to you before you are age 59 1/2 59½ will be subject to the 10% additional income tax on early distributions (unless an exception applies) and required minimum distributions from your IRA XXX do not have to start until after you are age 70 ½ . 70½. If you treat the IRA XXX as an inherited IRAXXX, payments from the IRA XXX will not be subject to the 10% additional income tax on early distributions. However, if the participant had started taking required minimum distributions, you will have to receive required minimum distributions from the inherited IRAXXX. If the participant had not started taking required minimum distributions from the Plan, you will not have to start receiving required minimum distributions from the inherited IRA XXX until the year the participant would have been age 70 ½. 70½. If you are a surviving beneficiary other than a spouse: . If you receive a payment from the Plan because of the participant’s death and you are a designated beneficiary other than a surviving spouse, the only rollover option you have is to do a direct rollover to an inherited IRAXXX. Payments from the inherited IRA XXX will not be subject to the 10% additional income tax on early distributions. You will have to receive required minimum distributions from the inherited IRAXXX. Payments under a qualified domestic relations order. If you are the spouse or former spouse of the participant who receives a payment from the Plan under a qualified domestic relations order (QDRO), you generally have the same options the participant would have (for example, you may roll over the payment to your own IRA XXX or an eligible employer plan that will accept it). Payments under the QDRO will not be subject to the 10% additional income tax on early distributions. If you are a nonresident alien If you are a nonresident alien and you do not do a direct rollover to a U.S. IRA XXX or U.S. employer plan, instead of withholding 20%, the Plan is generally required to withhold 30% of the payment for federal income taxes. If the amount withheld exceeds the amount of tax you owe (as may happen if you do a 60-day rollover), you may request an income tax refund by filing Form 1040NR and attaching your Form 1042-S. See Form W-8BEN for claiming that you are entitled to a reduced rate of withholding under an income tax treaty. For more information, see also IRS Publication 519, U.S. Tax Guide for Aliens, and IRS Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities. Other special rules If a payment is one in a series of payments for less than 10 years, your choice whether to make a direct rollover will apply to all later payments in the series (unless you make a different choice for later payments). If your payments for the year are less than $200 (not including payments from a designated Xxxx account in the Plan), the Plan is not required to allow you to do a direct rollover and is not required to withhold for federal income taxes. However, you may do a 60-day rollover. Unless you elect otherwise, if your plan's cashout limit is greater than $1,000, a mandatory cashout of more than $1,000 (not including payments from a designated Xxxx account in the Plan) will be directly rolled over to an IRA XXX chosen by the Plan administrator or the payor. A mandatory cashout is a payment from a plan to a participant made before age 62 (or normal retirement age, if later) and without consent, where the participant's ’s benefit does not exceed the plan's defined cashout limit (not in excess of $5,000 (may or may not include including any amounts held under the plan as a result of a prior rollover made to the plan)). You may have special rollover rights if you recently served in the U.S. Armed Forces. For more information, see IRS Publication 3, Armed Forces’ Tax Guide.