Answers to Questions About Your Pension Plan

The questions and answers that follow are designed to help you understand the basic provisions of your Pension Plan as they apply to participants working in covered employment after April 1, 2006. Your rights are governed by the Formal Pension Plan and by the determinations of the Trustees Document.

About the Plan

The Carpenters District Council of Kansas City Pension Plan became effective on April 1, 1968 and it has been amended and improved from time to time since contributions from employers began. The purpose of the Plan is to provide retirement income for carpenters who work a number of years under the terms of the collective bargaining agreements. If you work in such covered employment enough years to qualify for the benefits as described in the booklet, you may be eligible for:

  • A lifetime monthly income payable beginning at age 61 or as early as age 55 with a reduction in the amount because of your earlier age.
  • A disability benefit if you become totally and permanently disabled before reaching age 65.
  • A benefit after earning 31 pension credits without any minimum retirement age.
  • A choice when you retire as to how you want to receive your monthly payments and the way your survivors may be protected.
  • Certain benefits payable to your survivors if you do not live until retirement.

The benefits of the Plan and the requirements for eligibility are explained on this web page.  Other information about the Plan will be found in this section too.

What is the Pension Fund?

The Pension fund is a legal trust fund set up for the purpose of providing retirement benefits. The Agreement and Declaration of Trust originally dated April 1, 1968, established the Pension Trust Fund. The Trust Agreement and the Pension Plan govern the Fund’s operations.

What is the Pension Plan?

The Pension Plan is the legal document, which sets forth the various types of pensions provided by the Fund, the benefit amounts for each type of pension and also the eligibility requirements.

Who Administers the Fund?

A Board of Trustees, which serves without compensation, acts on behalf of participants in managing all aspects of the Pension Fund’s operations. This Board is made up of union and employer representatives whose powers and duties are set forth in a legal document called the Agreement and Declaration of Trust. The Board of Trustees has entered into a contract with an administrative agent, which manages the day-to-day operations of the Fund.

Who Pays the Cost of the Pension Plan?

The entire cost of the Plan is paid by the participating employers who contribute to the Pension Fund in accordance with their collective bargaining agreements with the union. No contributions are required from you and none are permitted.

How Were the Benefit Amounts for the Various Types of Pensions Determined?

The Pension Plan was set up on the basis of detailed actuarial studies so that the individuals entitled to pensions are assured that they will receive the promised benefits for the remainder of their lives following retirement.

Who is Covered by the Pension Plan?

All employees for whom employers are obligated to make contributions to the Pension Fund in accordance with the collective bargaining agreements or other written agreements with the union are covered by the Pension Plan.

Can the Benefits Under the Plan Be Changed?

Yes, the Trustees may change the benefit amounts. Any such change will be made upon the recommendations of an actuary who has made necessary calculations to assure the validity of any such change.

Will Additional Pension Credits Be Received if an Employee Continues to Work After Age 65?

Yes, an employee will receive pension credits as long as the employee works in covered employment.

Can Pension Benefits Be Assigned or Used As Collateral for a Loan?

No. Benefits cannot be sold, assigned or pledged as security for a loan. Furthermore, pension benefits are not normally subject to attachment or execution under any judgment or decree of a court or otherwise. However, the Pension Fund must comply with a qualified domestic relations order which recognizes the rights of a former spouse or child to benefits.

Can I Receive Social Security Benefits in Addition to Benefits Provided Under This Plan?

Yes. Social Security Benefits paid by the Social Security Administration are independent of this Pension Plan.

Can a Participant Obtain a Statement of the Pension Credit, Vesting Service and Benefits Earned?

Yes. A participant may obtain a statement of pension credit, vesting service and benefits earned once each year by submitting a written application to the Fund Office.

.

What Happens if an Employee is Too Ill to Manage His or Her Own Affairs?

If an employee is too ill to manage his or her own affairs, the Trustees may pay any benefits due to the employee’s guardian, committee or legal representatives or, in their absence, to any relative the Trustees consider entitled to receive such benefits on the employee’s behalf.

When Am I No Longer a Participant Under the Plan?

If you have not met the requirements for vesting and you do not complete at least 400 hours of service in a plan year, you are no longer a participant. This is called a one-year break in service, described in the section titled Breaks in Service. However, once you have met the vesting requirements under the Plan, you always remain a participant under the Plan.

About Pension Credits and Years of Vesting Service

How is Pension Credit Determined?

Pension credit is determined in TWO WAYS depending on whether it is BEFORE or AFTER the contribution date when employers were first required to make contributions to the Fund for an employee’s work in accordance with collective bargaining agreements.

How is Pension Credit Counted Before the Contribution Period?

Pension credit before the contribution period is credited for work in covered employment before April 1, 1968, (or a later date for employers or bargaining units which became covered by a collective bargaining agreement within the jurisdiction after that time) even though no Pension Fund had been established and no money had been paid to cover the costs of the credits earned.

You will be entitled to one pension credit for each year during which you worked at least 400 hours in what would have been covered employment if performed after the Fund was established.

A maximum of 20 pension credits will be counted before the contribution period in determining the pension amount.

The Trustees realize that many employees may have difficulty in establishing a complete record of hours-worked in covered employment before the contribution period. Therefore, pension credit for the years before April 1, 1968, will be recognized on the basis of the best information available, such as Social Security records, union records, employer records or welfare fund records.

How is Pension Credit Counted During the Contribution Period?

What Are Years of Vesting Service?

Years of vesting service are earned by an employee’s hours of service during the contribution period. An hour of service is each hour for which an employee is paid or entitled to be paid by a contributing employer, including periods of time when no duties are performed, such as during vacation, illness or military duty. However, any hours of service in non-covered employment (a job not covered by the collective bargaining agreement) will only be counted if they are after March 31, 1976, and that employment is immediately before or after covered employment with the same employer.

You will be credited with one year of vesting service for each plan year in which you complete 400 hours of service in covered employment.

Hours of service for an apprentice are counted toward a year of vesting service from the date of employment with a contributing employer until contributions are required to be paid.

What is the Difference Between Pension Credits and Years of Vesting Service?

There are a number of differences between pension credits and years of vesting service:

  1. Years of vesting service are earned only during the contribution period; you may earn pension credit both before and during that time.
  2. You may qualify for a Vested Pension based on years of vesting service. All other kinds of pensions require pension credits only.
  3. Vesting service is earned for all hours of service and pension credit is earned only for work in covered employment. An hour of service is each hour for which you are paid or entitled to be paid by a contributing employer, including not only hours of work but also certain hours for which no work is performed, such as disability or vacation hours.
  4. A year of vesting service or one pension credit is earned after you complete 400 hours of service in covered employment.

Can I Lose Pension Credit and Years of Vesting Service?

Yes. Because the Plan is designed to provide benefits to employees who have had continuing employment in the jurisdiction of the Fund, provisions have been made for cancellation of credit for employees who leave after only a few years of work under the Plan. Such cancellation is described in the section below titled Breaks in Service.

About Breaks in Service

What is a Break in Service?

A break in service occurs if you are absent from covered employment during specified periods of time. In general, when you have a break in service you are no longer a participant in the Plan. If you have a permanent break in service, your pension credit and years of vesting service and total contributions earned before the break are cancelled. However, if you are eligible for any type of pension under the Plan, you cannot have a permanent break in service or lose your pension rights.

The break in service rules have changed over the years since the Plan was first adopted. Currently, you have a permanent break when the number of your consecutive one-year breaks equals five. If, however, you have satisfied the requirements for any type of retirement benefit under the Plan, you will not have a permanent break in service.

An example of a permanent break in service follows:

 


Hours of Work


Pension Credit

Years of Vesting Service

One-Year Breaks in Service

Year 1

1,525

1

1

0

Year 2

1,400

1

1

0

Year 3

1,310

1

1

0

Year 4

100

0

0

1

Year 5

80

0

0

1

Year 6

0

0

0

1

Year 7

0

0

0

1

Year 8

0

0

0

1

 

 

 

 

 

Total

 

3

3

5

This employee has 3 years of vesting service, 3 pension credits, and 5 consecutive one-year breaks. The employee has a permanent break in service at the end of Year 8, which cancels all of the employee’s pension credits, and years of vesting service under the Plan. The employee did not have a permanent break in service after Year 6, even though the employee had 3 pension credits and 3 years of vesting service and 3 one-year breaks because a permanent break cannot occur unless an employee has at least 5 consecutive years of one-year breaks in service. If this employee had earned more than 5 years of vesting service or 5 pension credits, a permanent break would not occur.

If this employee returned to employment in Year 8 and completed at least 400 hours of work, the employee work record would look like this:

 


Hours of Work


Pension Credit

Years of Vesting Service

One-Year Breaks in Service

Year 1

1,525

1

1

0

Year 2

1,400

1

1

0

Year 3

1,310

1

1

0

Year 4

100

0

0

1

Year 5

80

0

0

1

Year 6

0

0

0

1

Year 7

0

0

0

1

Year 8

400

1

1

0

 

 

 

 

 

Total

 

4

4

0*

In this example, the employee reinstated participation, pension credit, years of service and contributions by returning to employment and receiving credit for 400 hours in Year 8. Because the number of the employee’s consecutive one-year breaks was less than 5, the employee was able to repair the one-year breaks.

*IMPORTANT: One-year breaks will not be added together unless they come right after the other, without interruption by a plan year in which an employee is credited with at least 400 hours of work or service.

Are There any Exceptions to the Break in Service Rules?

Yes. Certain periods of time will not be counted in determining if a break has occurred. These periods of time will be considered exceptions if your failure to earn years of vesting service or pension credit was caused by:

  1. total disability, PROVIDED written notice is given to the Trustees within one year of the start of such disability.
  2. service in the Armed Forces of the United States in time of war, national emergency or pursuant to the draft provided that you are available to work in covered employment within 90 days after discharge or recovery from a service related disability; or
  3. absence from work because of childbirth, adoption or infant care, up to a maximum of 400 hours of service in the year the absence starts or, if not required in that year to prevent a break, in the following year.  Any leave of absence granted by your employer, up to 12 weeks, that qualifies under the Family and Medical Leave Act (FMLA) will not be counted as a break in service for purposes of determining eligibility and vesting.

If I Leave Covered Employment after Many Years of Work, Do I Lose My Pension Rights?

If you leave covered employment after meeting the eligibility requirements for any pension under the Plan, other than a Disability Pension, you will have a right to a pension benefit. This means that you can leave the jurisdiction of the Plan without suffering a permanent break in service and without losing your pension rights.

About Plan Benefits

What Types of Pensions Are Provided by the Pension Plan?

The Pension Plan provides several different kinds of pensions as follows:

  1. A Regular Pension if:

a.    You are age 61, and

b.    You have at least 5 pension credits and at least 1,200 hours of contributions earned during any three consecutive plan years or at least 7,500 hours of contributions made to the Fund on your behalf.

  1. A Service Pension, which is calculated like a Regular Pension with no minimum retirement age if you have at least 31 pension credits.
  2. An Early Retirement Pension if:

a.    you are age 55,

b.    you have at least 5 pension credits and at least 1,200 hours of contributions earned during any three consecutive plan years or at least 7,500 hours of contributions, made to the Fund on your behalf.

  1. A Disability Pension if:

a.    you are totally and permanently disabled (FOR THIS PURPOSE, MEDICAL EVIDENCE, SUCH AS A PHYSICIAN’S STATEMENT OR A DETERMINATION THAT YOU ARE ENTITLED TO A SOCIAL SECURITY DISABILITY BENEFIT, WILL BE REQUIRED AS PROOF OF TOTAL DISABILITY. CERTIFICATION BY TWO DULY INDEPENDENT, LICENSED MEDICAL PRACTITIONERS WILL BE REQUIRED); and

b.    you have at least 15 pension credits, and

c.    you have at least 400 hours of work in Covered Employment for which contributions are required in one of the two plan years preceding the plan year in which you became disabled.

  1. A Vested Pension if you have at least 5 years of vesting service.
  2. A Normal Retirement Benefit if:

a.    you are not eligible for one of the pensions described above, and

b.    you are a participant in the Plan at or after your normal retirement age or in the plan year preceding the year in which you reached your normal retirement age. An employee is considered a participant in a plan year in which the employee earns at least 400 hours of service.

Normal retirement age is the later of age 65 or, the fifth anniversary of an employee’s participation. However, participation before a permanent break in service is not counted.

How is the Amount of a Participant’s Pension Determined?

A Number of factors are taken into account in calculating the amount of a pension – a participant’s age and marital status and the number of pension credits the employee earned before the contribution period and the amount of contributions made to the Fund on the employee’s behalf.

If a Participant is married when the Participant retires, the Participant’s pension benefit will automatically be paid in the form of a Qualified Joint and 50% Survivor Pension unless the Participant rejects this form of payment before the Participant’s pension begins, the spouse consents to the rejection, and the rejection is witnessed by a notary public or designated Plan representative. A Participant also has the option of electing a Joint and 75% Survivor Pension or a Joint and 100% Survivor Pension. The pension amounts shown in the examples in this section are for a pension for the Participant’s lifetime only. The Joint and 50%, 75% and 100% Survivor Pension amounts will be somewhat lower than the pension amounts in the following examples, in order to pay for the survivor coverage. For more information on the Joint and 50%, 75%, and 100% Survivor Pension, click here.

If the actuarial present value of any benefit payable under the Plan is $5,000 or less as of the date the payment would begin, the benefit will be paid in a single sum. However, once your benefit payments begin, no single sum will be paid unless you or your beneficiary consents, in writing, to such a payment form.

NOTE: When all defined benefit plans are aggregated, no participant (including Fund Office and Union clerical staffs) will receive benefits that exceed the average of the participant’s highest three years of compensation (W-2 income).

What is the Amount of the Regular Pension?

The monthly amount of the Regular Pension is determined as follows, for participants who first retire on or after April 1, 2006 and who have not separated from covered employment (as defined below):

  1. Multiply the number of pension credits you earned before the contribution period (to a maximum of 20) by $2.00.
  2. Multiply the amount of contributions paid on your behalf between, on or after April 1, 1968 and March 31, 2000 by 3.65%.
  3. Multiply the amount of contributions paid on your behalf between, on or after April 1, 2000 and March 31, 2005 by 3.35%.
  4. Multiply the amount of contributions paid on your behalf between, on or after April 1, 2005 and March 31, 2006 by 2.5%.
  5. Multiply the amount of contributions paid on your behalf between, on or after April 1, 2006 and March 31st, 2007 by 2.3%
  6. Multiply the amount of contributions paid on your behalf on or after April 1, 2007 by 1.5%
  7. Add together the amounts calculated in 1, 2, 3, 4, 5, and 6 above to determine your monthly benefit. If the amount of the pension benefit is not an exact multiple of $.50, it is rounded to the next higher $.50 amount.is not an exact multiple of $.50, it is rounded to the next higher $.50 amount.

EXAMPLE:

5 past pension credits * $2.00

=

$10.00

 

PLUS

 

 

$70,000.00 (contributions between
April 1, 1968 and March 31, 2000) * 3.65%


=


$2,555.00

 

PLUS

 

 

$21,500.00 (contributions between
April 1, 2000 and March 31, 2005) * 3.35%


=


$720.25

 

PLUS

 

 

$5,600 (contributions* between
April 1, 2005 and March 31, 2006) * 2.5%


=


$140.00

 

PLUS

 

 

$10,000 (contributions* between
April 1, 2006 & March 31, 2007)*
2.3%


=


$
230.00

$30,000 (contributions* on or after
April 1, 2007)*
1.5%


=


$
450.00

     

Regular Monthly Pension Amount


=


$4,105.25


      * Please note that employer contributions increased in 2005 and 2006. These increased contributions are supplemental "funding contributions", which means they will be used to increase the Pension Plan's assets and will not result in benefit accrual or pension credit.
 

If you separated from covered employment or first retired before April 1, 2000, a different benefit rate will apply to you. Please contact the Fund Office for more information. The Plan will consider you to have “Separated” from covered employment if you don’t work at least 400 hours in covered employment in two consecutive plan years. If you come back to work and earn one Pension Credit (400 hours), you won’t be considered “Separated” from covered employment.

What is the Amount of the Early Retirement Pension?

The monthly amount of the Early Retirement Pension is determined as follows:

  1. Calculate the amount of the Regular Pension to which you would be entitled if you were age 61.

  2. Multiply this amount by the percentage as show below for the number of full years you are younger than 61.

Number of Years
(Rounded to the Nearest Full Year)

Percentage of Regular
Retirement Benefits

1

95%

2

90%

3

85%

4

80%

5

75%

6

70%

If the Resulting amount is not an exact multiple of $.50, round to the next higher $.50 amount.

EXAMPLE:

An employee retires at age 57 with 2 past pension credits before the contribution date, $60,000 in contributions between April 1, 1968 and March 31, 2000, $16,500 in contributions between April 1, 2000 and March 31, 2005, $4,000 in contributions between April 1, 2005 and March 31, 2006,  $12,000 in contributions between April 1, 2006 and March 31, 2007, and $30,000 in contributions on or after April 1, 2007. The employee’s Early Retirement benefit will be figured as follows:

 

2 past pension credits * $2.00

=

$4.00

     Plus

   

$60,000 (contributions between
April 1, 1968 and March 31, 2000) * 3.65%


=


$2,190.00

     Plus

   

$16,500 (contributions between
April 1, 2000 and March 31, 2005) * 3.35%


=


$552.75

     Plus

   

$4,000 (contributions* between
April 1, 2005 and March 31, 2006) * 2.5%


=


$100.00

     Plus

   

$12,000 (contributions* between
April 1, 2006 and March 31, 2007) * 2.3%


=


$276.00

$30,000 (contributions* in or after
April 1, 2007) * 1.5%


=


$450.00

     

Regular Monthly Pension Amount


=


$3,572.75

The pension amount payable at age 61 would be $3,572.75. Because the employee is 4 years younger than age 61, this amount is multiplied by 80% (the percentage shown in the above table) and the employee's Early Retirement pension is $2,858.20 per month.

      * Please note that employer contributions increased in 2005 and 2006. These increased contributions are supplemental "funding contributions", which means they will be used to increase the Pension Plan's assets and will not result in benefit accrual or pension credit.

What is the Amount of the Disability Pension?

For Disability Pensions effective on or after April 1, 2005, the monthly amount of the Disability Pension is determined as follows:

  1. Calculate the amount of the Regular Pension to which you would be entitled if you were age 61.

  2. Multiply this amount by the percentage as shown below for the number of full years you are younger than age 61.

Number of Years
(Rounded to the Nearest Full Year)

Percentage of Regular
Retirement Benefits

1

95%

2

90%

3

85%

4

80%

5

75%

6

70%

7

65%

8

60%

9

55%

10

50%

In no event will Disability Pension benefits be reduced by more than 50%

Using the Early Retirement example above, assume an employee becomes disabled at age 54 and the pension payable at age 61 is $3,123.00. Because the employee is 7 years younger than age 61, this amount is multiplied by 65% (the percentage shown in the table above) and the employee's Disability Retirement Pension is $2,030.00 ($3,123.00 * 65% = $2,029.95, rounded to $2,030.00).

The Disability Pension Benefit is payable for life, assuming, of course that you remain totally and permanently disabled. Payment of a Disability Pension will begin on the first day of the seventh month following the month in which the disability begins or, if later, the first day of the month after the pension application is filed.

If you are married when you become totally and permanently disabled, your disability benefit is automatically payable as a Qualified Joint and 50% Survivor Pension unless you elect to reject this form of payment, your spouse consents to the rejection, and the rejection is witnessed by a notary public or a designated Plan representative. You have the option of electing another payment form such as: the Joint and 75% Survivor Pension, the Joint and 100% Survivor Pension, or the Ten-Year Certain Option. If you elect the Joint and 50%, 75% or 100% Survivor Pension, your monthly disability benefit can be determined by using the appropriate schedule for Joint and Survivor Pensions.

An employee is considered to be totally and permanently disabled if the Board of Trustees finds, on the basis of medical evidence, the employee’s disability (whether mental or physical) is total and will continue for the rest of the employee’s life.

The Board of Trustees’ decision as to whether an employee is totally and permanently disabled will be based on submitted proof of disability. Such proof must be in the form of a signed statement provided by two independent physicians, which may be selected by the Trustees. The Trustees may also require that the employee submit to medical examinations both before and periodically following the commencement of a Disability Pension.

What is a Reciprocal Pension?

A reciprocal Pension is provided for carpenters who would not otherwise qualify for a pension, or whose pension would be less than the full amount, because their years of employment have been divided between the jurisdiction of this Pension Plan and other carpenters’ pension plans in the United States, which adopt the United Brotherhood of Carpenters and Joiners National Reciprocity Agreement.

How Do I Find Out if I Have Worked in the Jurisdiction of a Pension Fund That has Signed the Reciprocity Agreement?

If you have worked in another territory under the jurisdiction of a Carpenter’s Union collective bargaining agreement or should you move to another jurisdiction, call or write the Fund Office for information pertaining to this provision of the Plan.

When Am I Eligible for a Reciprocal Pension?

You are eligible if:

  1. you would be eligible for any type of pension under this Plan if your combined pension credits (credits under this Plan and added to those earned under other carpenters' pension plans) were treated as credits earned under the Carpenters District Council of Kansas City Pension Fund; and

  2. you earned at least one pension credit under the Carpenters District Council of Kansas City Pension Fund, for which contributions were received by the Fund, and

  3. you are eligible to receive a Reciprocal Pension from another Fund, which has signed the United Brotherhood of Carpenters and Joiners National Reciprocal Agreement.

What Happens if I Delay Receiving Pension Benefits Beyond Age 65?

If you delay receiving your pension benefits beyond age 65, your pension benefit will be adjusted to take account of the later age at which your benefit payments begin. However, the law requires that your benefits commence by not later than April 1 or the calendar year following the calendar year in which you reach age 70 ½.

About Survivor Benefits after Retirement

What Type of Survivor Benefits after Retirement are Provided by the Plan?

There are five types of survivor benefits payable when a pensioner dies. The Survivor benefits are: Qualified Joint and 50% Survivor Pension, Joint and 75% Survivor Pension, Joint and 100% Survivor Pension, Ten-Year Certain and Life Option, and Lump-Sum Benefit. However, only one type of survivor benefit can be paid, even if you meet the requirements for more than one.

What is the Qualified Joint and 50% Survivor Pension?

If you are married when you retire, your pension benefit is automatically payable in the form of a Qualified Joint and 50% Survivor Pension unless you reject this form of payment, your spouse consents to the rejection, and the rejection (with spousal consent) is witnessed by a notary public or designated Plan representative. This benefit provides a reduced monthly benefit for you so that, upon your death, your spouse will receive 50% of the benefit you were receiving for the rest of your spouse’s life.

How is the Qualified Joint and 50% Survivor Pension Calculated?

Your monthly pension benefit will be actuarially reduced, taking into consideration, the difference between your age and your spouse’s age. The reduction factor is calculated by starting with 88% for any pension, except a Disability Pension, or 77.5% for a Disability Pension and either adding 0.4% for each full year your spouse is older than you or subtracting 0.4% for each full year that your spouse is younger than you on the effective date of your pension.

For example, you retire at age 61 and are eligible for a Regular Pension of $1,500 per month and your spouse is age 59. The reduction factor would be 87.2% based on a spouse who is 2 years younger. Therefore, the Qualified Joint and 50% Survivor Pension would be $1,308.00 ($1,500 * 87.2% = $1,308.00) a month. This amount is payable to you for your lifetime. If your spouse is living at the time of your death, your spouse will receive a monthly benefit of half this amount, or $654.00, for the remainder of your spouse’s lifetime. Should your spouse die before you do, your benefit will increase to the amount that would have been payable had you and your spouse waived the Qualified Joint and 50% Survivor Pension.

The actuarial reduction factors are shown on the following table for participants with a spouse from 1 to 10 years older or 1 to 10 years younger.

Spouse’s age Compared
With Participant’s Age

Actuarial Reduction Factor
for Qualified Joint and 50% Survivor Pension

 

Non-Disability

Disability

10 years older

92.0%

81.5%

9

91.6%

81.1%

8

91.2%

80.7%

7

90.8%

80.3%

6

90.4%

79.9%

5

90.0%

79.5%

4

89.6%

79.1%

3

89.2%

78.7%

2

88.8%

78.3%

1 year older

88.4%

77.9%

Same Age

88.0%

77.5%

1 year younger

87.6%

77.1%

2

87.2%

76.7%

3

86.8%

76.3%

4

86.4%

75.9%

5

86.0%

75.5%

6

85.6%

75.1%

7

85.2%

74.7%

8

84.8%

74.3%

9

84.4%

73.9%

10 years younger

84.0%

73.5%

 

Are There Rules for Payment of the Joint and 50%, 75% and 100% Survivor Pension?

Yes. They are as follows:

  1. The spouse must have been legally married to the participant on the effective date of the pension and for at least one year before the participant’s death.
  2. If the spouse dies before the pensioner, the pensioner’s monthly benefit will be increased to the amount that would have been payable had the pensioner and spouse waived the Qualified Joint and 50% Survivor Pension and not elected the Joint and 75% Survivor Pension or Joint 100% and Survivor Pension at the time of the pensioner’s retirement.
  3. If the pensioner and spouse are divorced after the Qualified Joint and 50% Survivor Pension, Joint and 75% Survivor Pension or Joint 100% and Survivor Pension begins, the pensioner’s former spouse will still be eligible for the survivor’s pension, unless a qualified domestic relations order provides otherwise, in which case the pensioner’s monthly benefit will be increased to the amount that would have been payable had the pensioner and spouse waived the Qualified Joint and 50% Survivor Pension and not elected the Joint and 75% Survivor Pension or Joint 100% and Survivor Pension at the time of the pensioner’s retirement.
  4. Payments are made to a surviving spouse for the spouse’s lifetime even if the spouse remarries.
  5. The Plan, in accordance with the law, must recognize a qualified domestic relations order.

What is the Joint and 75% Survivor Pension?

If you retire on or after April 1, 1993, and you are married, you can elect a Joint and 75% Survivor Pension. This benefit provides a reduced monthly benefit for you so that, upon your death, your spouse will receive 75% of the benefit that you were receiving for the rest of your spouse’s life. In order to elect the Joint and 75% Survivor Pension, you and your spouse must sign a valid waiver form rejecting the Qualified Joint and 50% Survivor Pension.  This waiver must be witnessed by a notary public or a designated Plan representative. Click here to see the rules for payment of the Joint and 75% Survivor Pension.

How is the Joint and 75% Survivor Pension Calculated?

Your monthly benefit will be actuarially reduced, taking into consideration the difference in your age and your spouse’s age. The reduction factor is reduced by starting with 83.5% for any pension, except a Disability Pension, or 70.0% for Disability Pension, and adding 0.5% for each year that you are younger than your spouse or subtracting 0.5% for each year that your are older than your spouse.

For example, you retire at age 61, are eligible for a Regular Pension of $1,500 and you and your spouse elect the Joint and 75% Survivor Pension. Your spouse’s age is 58. The reduction factor would be 82% based on a spouse who is 3 years younger. Therefore, the Joint and 75% Survivor Pension would be $1,230 ($1,500 * 82% = $1,230). This amount is payable to you for your lifetime. If your spouse is living at the time of your death, your spouse will receive a monthly benefit of $922.50 ($1,230 * 75% = $922.50) for the remainder of your spouse’s lifetime. If your spouse dies before you do, your benefit will increase to the single-life amount that would have been payable had you and your spouse waived all the various options at the time of your retirement.

The actuarial reduction factors (+/- 0.5%) are shown in the following table for participants with a spouse from 1 to 10 years older or 1 to 10 years younger.

Spouse’s age Compared
With Participant’s Age

Actuarial Reduction Factor
for Qualified Joint and 75% Survivor Pension

 

Non-Disability

Disability

10 years older

88.5%

75.0%

9

88.0%

74.5%

8

87.5%

74.0%

7

87.0%

73.5%

6

86.5%

73.0%

5

86.0%

72.5%

4

85.5%

72.0%

3

85.0%

71.5%

2

84.5%

71.0%

1 year older

84.0%

70.5%

Same Age

83.5%

70.0%

1 year younger

83.0%

69.5%

2

82.5%

69.0%

3

82.0%

68.5%

4

81.5%

68.0%

5

81.0%

67.5%

6

80.5%

67.0%

7

80.0%

66.5%

8

79.5%

66.0%

9

79.0%

65.5%

10 years younger

78.5%

65.0%

What is the Joint and 100% Survivor Pension?

If you retire on or after April 1, 1993, and you are married, you can elect a Joint and 100% Survivor Pension. This benefit provides a reduced monthly benefit that, upon your death, your spouse will receive 100% of the benefit that you were receiving for the rest of your spouse’s life. In order to elect the Joint and 100% Survivor Pension, you and your spouse must sign a valid waiver form rejecting the Qualified Joint and 50% Survivor Pension. This waiver must be witnessed by a notary public or a designated Plan representative. Click here for the rules for payment of the Joint and 100% Survivor Pension.

How is the Joint and 100% Survivor Pension Calculated?

Your monthly benefit will be actuarially reduced, taking into consideration the difference in your age and your spouse’s age. The reduction factor is reduced by starting with 79% for any pension, except a Disability Pension, or 63% for a Disability Pension, and adding 0.6% for each year that you are younger than your spouse or subtracting 0.6% for each year that your are older than your spouse.

For example, you retire at age 65, are eligible for a Regular Pension of $1,500 and you and your spouse elect the Joint and 100% Survivor Pension. Your spouse’s age is 60. The reduction factor would be 76% based on a spouse who is 5 years younger. Therefore, the Joint and 75% Survivor Pension would be $1,140 ($1,500 * 76% = $1,140). This amount is payable to you for your lifetime. If your spouse is living at the time of your death, your spouse will receive a monthly benefit of $1,104.00 for the remainder of your spouse’s lifetime. If your spouse dies before you do, your benefit will increase to the single-life amount that would have been payable had you and your spouse waived all the various options at the time of your retirement.

The actuarial reduction factors (+/- 0.6%) are shown in the following table for participants with a spouse from 1 to 10 years older or 1 to 10 years younger.

Spouse’s age Compared
With Participant’s Age

Actuarial Reduction Factor
for Qualified Joint and 100% Survivor Pension

 

Non-Disability

Disability

10 years older

85.0%

69.0%

9

84.4%

68.4%

8

83.8%

67.8%

7

83.2%

67.2%

6

82.6%

66.6%

5

82.0%

66.0%

4

81.4%

65.4%

3

80.8%

64.8%

2

80.2%

64.2%

1 year older

79.6%

63.6%

Same Age

79.0%

63.0%

1 year younger

78.4%

62.4%

2

77.8%

61.8%

3

77.2%

61.2%

4

76.6%

60.6%

5

76.0%

60.0%

6

75.4%

59.4%

7

74.8%

58.8%

8

74.2%

58.2%

9

73.6%

57.6%

10 years younger

73.0%

57.0%

What is the Lump-Sum Benefit?

If you reject the Qualified Joint and 50% Survivor Pension and do not elect the Joint and 75% Survivor Pension, the Joint and 100% Survivor Pension or the Ten-Year Certain Option, a Lump-Sum Benefit is payable to your designated beneficiary or, if you have not designated a beneficiary, your spouse, or, if you do not have a surviving spouse, in equal shares to any dependent children, or, if you have no dependent children, to your estate.

The amount of the Lump Sum Benefit will be either:

  1. 20 times your monthly benefit ($2,500 maximum) LESS the total amount of benefits you received after retirement or, if greater,
  2. the total contributions made to the Fund on your behalf LESS the total amount of benefits you received after retirement.

However, if the total of all benefits paid to you exceeds total contributions made to the Fund on your behalf, the Lump-Sum Benefit shall not be payable.

How Can I make a Decision about Survivor Protection?

When you apply for your pension, the Fund Office will show you an estimate of the benefit payable in the different forms. Once you receive the estimate, you’ll have at least 30 days to decide whether or not you and your spouse (if married) want your pension paid as a Qualified Joint and 50% Survivor Pension or in one of the Funds optional forms of payment. You can make a choice or change a previous election by completing, signing and returning the Election of Benefits form to the Fund Office.

In no event can you reject the Joint and Survivor forms of payment more than 90 days before your pension effective date.

Remember, if you are married, your pension will automatically be paid as a Qualified Joint and 50% Survivor Pension unless both you and your spouse reject it in writing.

If you reject the Qualified Joint and 50% Survivor Pension and do not elect the Joint and 75% Survivor Pension, the Joint and 100% Survivor Pension or the Ten-Year Certain Option, you will receive an unreduced monthly amount and have the Lump-Sum protection. You should keep in mind though that a Lump-Sum Benefit is payable after retirement only if the total benefits paid before the death of the pensioner were less than either 20 times the monthly pension amount or the total contributions received on your behalf.

About Survivor Benefits Before Retirement

What Type of Survivor Benefits are Payable if an Employee Dies BEFORE Retirement?

There are three types of benefits payable before retirement. They are the Pre-Retirement Surviving Spouse Pension, the Lump-Sum Benefit and a Death Benefit for non-vested participants.

What is the Pre-Retirement Surviving Spouse Pension?

If you are married and die after August 22, 1984, but before retiring on a pension, your spouse may be eligible for a Pre-Retirement Surviving Spouse Pension as follows:

  1. You must have the pension credit or vesting service required for a pension.
  2. You and your spouse must have been married to each other for the one-year period ending on the date of your death.
  3. You must have earned an hour of service after April 1, 1976.

If you die when you were eligible for the immediate payment of a pension, the amount of the Pre-Retirement Surviving Spouse Pension is equal to one-half of the Qualified Joint and 50% Survivor Pension amount which would have been payable had you retired on the day before you died.

If you die before you were eligible to receive a pension, your eligible surviving spouse will receive one-half of the Qualified Joint and 50% Survivor Pension amount you would have received at the age you would have first met the requirements for immediate payment of a pension had you lived.

This means that, if you met the pension credit requirements for an Early Retirement Pension and were younger than 55 at death, the reduction for age applied to your pension will be determined as if you had attained age 55. The pension will be payable to your surviving eligible spouse beginning with the following month you would have attained age 55, had you lived.

The Pre-Retirement Surviving Spouse Pension will be paid on a monthly basis for the remainder of your eligible surviving spouse’s lifetime except that if the actuarial lump-sum value of the Pre-Retirement Surviving Spouse Pension is $1,000 or less, the Board of Trustees will pay out its full value in a lump sum to your surviving spouse.

What is the Lump-Sum Death Benefit?

If you die before retiring with a pension, a Lump-Sum Benefit may be payable if:

  1. you had earned at least 10 Pension Credits or you had at least 7,500 hours of contributions made on your behalf, and
  2. you were an active employee at time of death. To be considered active, you must have at least 400 hours of contributions made on your behalf in the plan year in which you died, or in the previous plan year.

The Lump-Sum will be payable to designated beneficiary or, if none, in the following order:

  1. to your surviving spouse or, if none,
  2. in equal shares to your dependent children or, if not, to your estate.

The amount of the Lump-Sum Benefit is:

  1. 20 times the pension amount for which you were eligible at the time of death, with a maximum of $2,500 or, if greater,
  2. the total contributions made to the Fund on your behalf.

If at the time of your death, your surviving spouse is also eligible for the Pre-Retirement Surviving Spouse Pension, your spouse will be given the choice of one benefit; in no event will more than one benefit be payable.

If your surviving spouse selects the Lump-sum Benefit and the amount is less than the actuarial present value of the Pre-Retirement Surviving Spouse Pension, the difference will be paid to your spouse as an additional lump sum.

What is the Death Benefit for Non-Vested Participants?

A Death Benefit of $1,500 will be paid to your designated beneficiary, or if none in the following order:

  1. your spouse, or, if none,
  2. in equal shares to your dependent children or, if none, to your estate.

You are eligible for this benefit if you are a non-vested Participant, provided you have worked at least 3,000 hours and that you have worked at least 400 hours during the plan year in which you died or during the preceding plan year.

About Procedures for Qualification of Domestic Relations Orders

What is a Qualified Domestic Relations Order?

The Plan must recognize a qualified domestic relations order. A “qualified domestic relations order” is a judgment, decree or order (including approval of a property settlement agreement) that

  1. relates to the provision of child support, alimony payments or marital property rights to a spouse, former spouse, child or other dependent of a participant and
  2. is made pursuant to a state domestic relations law.

A “domestic relations order” is a qualified domestic relations order (QDRO) if it creates or recognizes the existence of an alternate payee’s rights, or assigns to an alternate payee the right to receive all or a portion of the benefits payable to a participant under a plan, specifies required information and does not alter the amount or form of plan benefits.

An “alternate payee” is a spouse, former spouse, child or other dependent of a participant who is recognized by a domestic relations order as having a right to receive all, or a portion of, the benefit under a plan with respect to the participant.

If a qualified domestic relations order requires the distribution of all or part of your benefits under the Plan to an alternative payee, the Trustees are required to comply with the order.

What is the Procedure for Qualification of a Domestic Relations Order?

The following procedures were adopted by the Board of Trustees to determine the qualified status of domestic relations orders:

  1. In the event that a participant is involved in a divorce action and the parties need to or want to obtain information concerning the participant’s pension benefits, the participant and/or alternate payee and/or their designated representatives must submit a request for information, in writing, to the Fund Office. An Authorization to Release Information should be sent with the letter requesting information. The Authorization to Release Information form can be obtained from the Fund Office.
  2. If the participant is obtaining a divorce or has obtained a divorce, and a domestic relation order (usually referred to as a divorce decree or decree of dissolution) is to be entered or has been entered, the following process should be followed:

a.    The participant, alternate payee and/or their designated representative, shall submit a copy of the Domestic Relations Order or proposed order to the Fund Office as soon as possible. It is suggested that a proposed domestic relations order be sent to Fund Counsel prior to obtaining the Court’s approval so that the necessary revisions can be made to the order before it is entered by the Court.

b.    Fund Counsel shall review the domestic relations order to determine if it contains all of those items required by the Retirement Equity Act of 1984 (REA). The Fund Consultant and/or Fund Actuary shall issue a benefits report, which shall include a calculation of benefits to be paid to the participant and/or to the alternate payee, an actuarial analysis and a determination as to whether the order conforms to the provisions of the Plan.

c.    For a domestic relation’s order to be qualified, it must meet the requirements of Subsections i through viii, below:

i.      The order shall specify the name and the last known mailing address of the participant and the name and mailing address of each alternate payee covered by the Order;

ii.     The order shall specify the Social Security numbers of the participant and each alternate payee;

iii.    The order shall specify the amount or percentage of the participant’s benefits to be paid by the Fund to each alternate payee, or the manner in which the amount or percentage is to be determined;

iv.    The order shall specify the number of payments or period of time to which the order applies;

v.     The order shall state the proper legal name of each plan (or predecessor plan) to which the order applies;

vi.    The order shall not require the Plan to provide any type or form of benefit, or any option, not otherwise provided under the Plan;

vii.   The order shall not require the Plan to provide benefits in excess of the benefits to which the participant would otherwise be entitled under the Plan (determined on the basis of actuarial value); and

viii.  The order shall not require the payment of benefits to an alternate payee, which are required to be paid to another alternate payee under another order previously determined to be a qualified domestic relations order.

d.    Fund Counsel shall contact the participant and alternate payee and/or their designated representatives to resolve any issues, which prevent the domestic relations order from being qualified.

e.    The domestic relations order will then be submitted to the Pension Fund’s qualified domestic relations order committee for final approval as a qualified order.

f.      A copy of the final order entered by the Court shall be retained in the Fund’s permanent files for both the participant and the alternate payee.

g.    If the review process is not completed within eighteen (18) months after benefit payments are to be made in accordance with a qualified domestic relations order, the Fund will distribute the pension benefits as if a qualified domestic relations order concerning the distribution of pension benefits was never entered.

h.    During the period that a qualified domestic relations order is being reviewed, the Pension Fund will not distribute any pension benefits, unless the pension benefits are not in dispute.

  1. If the participant or alternate payee has any questions concerning the interpretation of the order, after a domestic relations order has been qualified, he/she should contact the Fund Office, in writing, to request a clarification. Any requests for clarification concerning qualified domestic relations orders will be submitted to the Pension Fund’s qualified domestic relations order committee for a decision. The Committee shall have the authority to interpret, construe and apply the provisions of the qualified domestic relations order and to make all decisions concerning the participant’s or alternate payee’s entitlement to benefits.
About Application for and Payment of Pension Benefits

How Can I Apply for a Pension?

Click here to find out how to print a pension application or request a pension application by writing, calling or making an appointment to visit the Fund Office.

The application should be completed, signed and returned to the Fund Office.  You must send proof of your date of birth with your application.

If you are married, you will need to provide proof of your marriage and your spouse’s birthday. If you are divorced or your spouse is deceased, you will need to provide proof of your divorce or your spouse’s death. If you are applying for a Disability Pension, you will have to submit to a medical examination or you will be required to provide proof of your disability.

When Will My Pension Be Paid?

Pensions are usually effective on the first day of the month following the month all conditions for the pension are met, including the filing of a pension application. However, if you are applying for a Disability Pension, it will not be effective until you have been disabled for six months and file a pension application.

The effective date of a pension (sometimes called the “annuity starting date”) is the date on which the first monthly pension payment is due. However, because the Fund Office requires some time to process pension applications, the first few payments may be delayed and paid retroactively to the effective date. In many cases records from Social Security must be obtained to verify your work prior to the time the Plan was established. Therefore, it is important to file a pension application well in advance of the month you want to receive your first pension check.

How Does a Survivor Apply for Benefits?

As soon as possible after the death of the employee or pensioner, the spouse or beneficiary should contact the Fund Office to request instructions for filing an application for survivor benefits. A copy of the death certificate for the employee or pensioner will be required. Copies of the employee’s and surviving spouse’s birth certificates and proof of marriage may also be requested.

Who Will Decide if I am Eligible for a Pension?

The Board of Trustees will decide if you meet the eligibility requirements for a pension.

How Will I know if My Pension Application is Denied?

If your application for a pension is denied, you will be informed in writing of the denial. You will also be told the reasons for the denial and the way in which you can appeal the Trustees’ decision.

If My Application is Denied, Do I have the Right to Appeal?

Yes. You (or your authorized representative) may file a written appeal with the Fund Office no later than 60 days after you receive the notice of denial. You may, at this time, request a hearing from the Board of Trustees or Claims Appeal Committee. You also have the right to review pertinent documents and to submit comments in writing.

The Board of Trustees or Claims Appeal Committee will, in most instances, notify you regarding their decisions on the appeal within 60 days after they received your request for review. This period can be extended to up to 120 days, if necessary. The Trustees will notify the employee or beneficiary, in writing, and such notice will include the specific reasons for the decision and specific references to Plan provisions on which the decision was based. The decision of the Board or Committee will be final and binding.

The Board of Trustees or Claims Appeal Committee shall have the authority to interpret, construe and apply all terms of the Restated Plan Document, the Summary Plan Description, the Amended Agreement and Declaration of Trust of the Carpenters District of Kansas City Pension Fund and/or any rules and regulations established by the Trustees including, but not limited to, provisions concerning eligibility for, entitlement to and/or nature, amount and duration of benefits, in reaching a decision on the claimant’s request for review of the denial of the claim.

Can I Roll My Distribution over Tax-Free to an IRA or Other Qualified Plan?

Generally all distributions, including death benefits paid to your spouse, are eligible for tax-free rollover except for distributions that are:

1.    substantially equal periodic payments over

a.      the life (or life expectancy) of a participant, or joint lives of a participant and beneficiary; or

b.      a scheduled period of at least 10 years; or

2.    mandatory minimum distributions after age 70 ½.

A payment that is eligible for rollover can be taken in two ways. You can have all or any portion of your payment either:

  1. paid in a direct rollover or
  2. paid to you. This choice will affect the tax you owe.

If you choose a direct rollover:

  1. your payment will not be taxed in the current year and no income tax will be withheld.
  2. your payment will be made directly to your IRA or, if you choose, to another qualified retirement plan that accepts your rollover, and
  3. your payment will be taxed later when you take it out of the IRA or the qualified retirement plan.

If you choose to have your benefit paid to you:

  1. you will receive only 80% of the payment, because federal law requires that the Fund withhold 20% of the payment and send it to the Internal Revenue Service as income tax withholding to be credited against your taxes.
  2. your payment will be taxed in the current year unless you roll it over (you may be able to use special tax rules that could reduce the tax you owe; however, if you receive the payment before age 59 1/2 , you may also have to pay an additional 10% tax.
  3. you can roll over the payment by paying it to your IRA or to another qualified retirement plan that accepts your rollover within 60 days of receiving the payment, and the amount will not be taxed until you take it out of the IRA or other qualified retirement plan, and
  4. if you want to roll over 100% of the payment to an IRA or another qualified retirement plan that accepts your rollover, you must find other money to replace the 20% that was withheld (if you roll over only the 80% that you received, you will be taxed on the 20% that was withheld and not rolled over).

About Retirement and Work After Retirement

What Does Retirement Mean?

Generally, retirement means that you have left covered employment and are not working in “disqualifying employment.” You may actually do certain types of work and still be considered retired, as long as that work is not what is called “disqualifying employment.”

What is Disqualifying Employment and What Happens if I Work in Disqualifying Employment?

If you return to disqualifying employment after you have retired and begun to receive your pension, your monthly benefit will be withheld, or suspended for each month that you are so employed.

Work that will disqualify a retiree from receiving the monthly benefit differs for those less than normal retirement age (generally age 65) and those age 65 and older. Prior to age 65, disqualifying employment is any employment or self-employment as follows:

  1. for wages or profit in any type of work covered by the collective bargaining agreement,
  2. in the construction industry, or
  3. for a contributing employer.

At or after age 65, disqualifying employment is work as a carpenter, or in another job classification covered by the Plan within the industry and geographical area covered by the Plan when pension payments began.

On and after age 65, a pensioner will be allowed to perform a limited amount of this type of work before it is considered disqualifying. The pensioner may work for up to the Social Security earnings limit during a calendar year (and then up to 39 hours per month) in disqualifying employment without being disqualified from receiving a monthly benefit. In applying the above rules, all paid hours are counted, including paid non-work hours.

Can I Work at Some Other Type of Job After Retirement?

Yes. You may do any work provided it is not of the type described above as “disqualifying employment” and you will continue to receive your monthly pension check. If you are not sure whether or not a job you are considering will be disqualifying, check with the Fund Office. You will receive an answer within 60 days.

Must I Provide Notice of My Return to Work?

Yes. You must notify the Fund Office of your return to work within 30 days of the date you return, regardless of the number of hours you intend to work.

If your work is disqualifying, the Fund Office will provide you with a notice that your benefit is suspended. This notice will tell you the reason for the suspension and how to let the Fund Office know when you later stop working. Your pension checks will not continue until you tell the Fund Office that the disqualifying employment has ended.

If you disagree with or do not understand the suspension, you may write to the Fund Office and request a review of the decision within 60 days of receiving the suspension notice. The Trustees will consider your comments promptly.

What Happens if I Continue to Receive My Pension Checks While I am Working in Disqualifying Employment?

It is important for you to know that you are obligated to repay the amounts your receive if you work in disqualifying employment and receive your pension. When you stop working and your benefits begin again, part of your payment may be withheld until the Fund has recovered benefits improperly paid to you. If you are age 65 or older, 100% of the first monthly payment and 25% of subsequent monthly payments will be withheld (including payments to your spouse), until all overpayments are recovered. Prior to age 65, 100% of all payments will be withheld until the overpayment is recovered.

If I Work in Disqualifying Employment, Will My Pension Be Recalculated When I Retire Again?

If you work in disqualifying employment and earn additional pension credit, your pension benefit will be recalculated when you resume retirement and will include additional contributions paid on your behalf. However, if you originally retired with an Early Retirement Pension, your recalculated pension will be actuarially adjusted for your increased age and to take into account the benefit payments received prior to your return to disqualifying employment.

If I Retire with a Disability Pension, May I Work?

If you are receiving a total and permanent disability benefit, your pension will be suspended for any months in which you have earnings from any employment.

If I Owe Money, Can I Sign Over My Rights to My Pension?

No. The Pension Plan prohibits any assignment, pledging or otherwise disposing of your pension payments except in relation to a qualified domestic relations order.

Where May I Find the Plan’s Rules Regarding Suspension of Benefits?

Click here to find the Plan’s rules regarding suspension of Benefits. Retirees will be provided with a description of the Plan rules regarding suspension of benefits, annually, or at any other time if you request it. The Plan rules are in accordance with the Department of Labor regulations concerning suspension of benefits. Those regulations can be found in Section 2530.203-3 of Volume 29 of the Code of Federal Regulations. The Department of Labor website can be found at www.dol.gov.