Okla. Stat. tit. 47, § 47-2-305.1A

Notice - Election.

A. This section applies to distributions made on or after

January 1, 2002. Notwithstanding any provision of the System to the

contrary that would otherwise limit a Distributee's election

hereunder, a Distributee, including a nonspouse designated

beneficiary, to the extent permitted under paragraph 3 of subsection

B of this section, may elect, at the time and in the manner

prescribed by the Board, to have any portion of an Eligible Rollover

Distribution paid directly to an Eligible Retirement Plan specified

by the Distributee in a Direct Rollover.

B. As used in this section:

1. "Eligible Rollover Distribution" means any distribution of

all or any portion of the balance to the credit of the Distributee,

except that an Eligible Rollover Distribution does not include: any

distribution that is one of a series of substantially equal periodic

payments (not less frequently than annually) made for the life (or

life expectancy) of the Distributee or the joint lives (or life

expectancies) of the Distributee and the Distributee's designated

beneficiary, or for a specified period of ten (10) years or more;

any distribution to the extent such distribution is required under

Section 401(a)(9) of the Internal Revenue Code of 1986, as amended;

and the portion of any distribution that is not includable in gross

income. A portion of a distribution shall not fail to be an

Eligible Rollover Distribution merely because the portion consists

of after-tax member contributions which are not includable in gross

income. However, such portion may be transferred only:

a. from January 1, 2002, through December 31, 2006:

(1) to an individual retirement account or annuity

described in Section 408(a) or (b) of the

Internal Revenue Code of 1986, as amended, or

(2) in a direct trustee-to-trustee transfer, to a

qualified trust which is part of a defined

contribution plan that agrees to separately

account for amounts so transferred, including

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separately accounting for the portion of such

distribution which is includable in gross income

and the portion of such distribution which is not

so includable, and

b. on or after January 1, 2007:

(1) to an individual retirement account or annuity

described in Section 408(a) or (b) of the

Internal Revenue Code of 1986, as amended, or

(2) in a direct trustee-to-trustee transfer to a

qualified trust or an annuity contract described

in Section 403(b) of the Internal Revenue Code of

1986, as amended, and such trust or contract

provides for separate accounting for amounts so

transferred (and earnings thereon), including

separately accounting for the portion of such

distribution which is includable in gross income

and the portion of such distribution which is not

so includable.

Effective for distributions after December 31, 2007, such after-

tax portion may also be directly transferred to a Roth individual

retirement account or annuity described in Section 408A of the

Internal Revenue Code of 1986, as amended, ("Roth IRA"), subject to

any limitations described in Section 408A(c) of the Internal Revenue

Code of 1986, as amended;

2. "Eligible Retirement Plan" means an individual retirement

account described in Section 408(a) of the Internal Revenue Code of

1986, as amended, an individual retirement annuity described in

Section 408(b) of the Internal Revenue Code of 1986, as amended, an

annuity plan described in Section 403(a) of the Internal Revenue

Code of 1986, as amended, or a qualified trust described in Section

401(a) of the Internal Revenue Code of 1986, as amended, that

accepts the Distributee's Eligible Rollover Distribution. Effective

January 1, 2002, an Eligible Retirement Plan shall also mean an

annuity contract described in Section 403(b) of the Internal Revenue

Code of 1986, as amended, and an eligible plan under Section 457(b)
e of 1986, as amended, or a qualified trust described in Section

401(a) of the Internal Revenue Code of 1986, as amended, that

accepts the Distributee's Eligible Rollover Distribution. Effective

January 1, 2002, an Eligible Retirement Plan shall also mean an

annuity contract described in Section 403(b) of the Internal Revenue

Code of 1986, as amended, and an eligible plan under Section 457(b)

of the Internal Revenue Code of 1986, as amended, which is

maintained by a state, political subdivision of a state, or any

agency or instrumentality of a state or political subdivision of a

state and which agrees to separately account for amounts transferred

into such plan from the System. Effective for distributions after

December 31, 2007, an Eligible Retirement Plan includes a Roth IRA,

subject to any limitations under Section 408A(c) of the Internal

Revenue Code of 1986, as amended. Effective for distributions after

December 18, 2015, an Eligible Retirement Plan includes a SIMPLE IRA

in accordance with Section 408(p)(1)(B) of the Internal Revenue Code

of 1986, as amended, for purposes of a rollover contribution to such

SIMPLE IRA, but only if such rollover contribution is made after

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December 18, 2015, and only if such rollover contribution occurs

after the two-year period described in Section 72(t)(6) of the

Internal Revenue Code of 1986, as amended;

3. "Distributee" means an employee or former employee. In

addition, the employee's or former employee's surviving spouse and

the employee's or former employee's spouse or former spouse who is

the alternate payee under a qualified domestic order, as defined in

subsection B of Section 2-303.3 of this title, are Distributees with

regard to the interest of the spouse or the former spouse. A

Distributee also includes the member's nonspouse designated

beneficiary (and certain trusts described in Section 402(c)(11)(B)

of the Internal Revenue Code of 1986, as amended), pursuant to

Section 401(a)(9)(E) of the Internal Revenue Code of 1986, as

amended, who may elect any portion of a payment to be made in a

Direct Rollover only to an individual retirement account or annuity

(other than an endowment contract) described in Section 408(a) or

(b) of the Internal Revenue Code of 1986, as amended, ("IRA")

(including, effective for distributions after December 18, 2015, a

SIMPLE IRA, but only if such contribution occurs after the two-year

period described in Code Section 72(t)(6) and is made in accordance

with the Protecting Americans from Tax Hikes Act of 2015), or,

effective for distributions after December 31, 2007, to a Roth IRA,

that is established on behalf of such nonspouse designated

beneficiary for the purpose of receiving the distribution and that

will be treated as an inherited IRA pursuant to the provisions of

Section 402(c)(11) of the Internal Revenue Code of 1986, as amended.

Also, in this case, the determination of any required minimum

distribution under Section 401(a)(9) of the Internal Revenue Code of

1986, as amended, that is ineligible for rollover shall be made in

accordance with Notice 2007-7, Q&A 17 and 18, 2007-5 Internal

Revenue Bulletin 395. The required minimum distribution rules of

Section 401(a)(9)(B) (other than clause iv thereof) of the Internal

Revenue Code of 1986, as amended, apply to the transferee IRA; and

4. "Direct Rollover" means a payment by the System to the

Eligible Retirement Plan specified by the Distributee.

C. At least thirty (30) days before and, effective for years

beginning after December 31, 2006, not more than one hundred eighty
ribution rules of

Section 401(a)(9)(B) (other than clause iv thereof) of the Internal

Revenue Code of 1986, as amended, apply to the transferee IRA; and

4. "Direct Rollover" means a payment by the System to the

Eligible Retirement Plan specified by the Distributee.

C. At least thirty (30) days before and, effective for years

beginning after December 31, 2006, not more than one hundred eighty

(180) days before the date of distribution, the Distributee (other

than a nonspouse designated beneficiary prior to July 1, 2010) must

be provided with a notice of rights which satisfies Section 402(f)

of the Internal Revenue Code of 1986, as amended, as to rollover

options and tax effects. Such distribution may commence less than

thirty (30) days after the notice is given, provided that:

1. The Board clearly informs the Distributee that the

Distributee has a right to a period of at least thirty (30) days

after receiving the notice to consider the decision of whether or

not to elect a distribution; and

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2. The Distributee, after receiving the notice, affirmatively

elects a distribution.

D. For distributions made after December 31, 2006, but prior to

July 1, 2010, a distribution with respect to a nonspouse designated

beneficiary shall be made in accordance with Notice 2007-7, Q&A 15,

2007-5 Internal Revenue Bulletin 395. Effective for plan years

beginning after December 31, 2009, a distribution with respect to a

nonspouse designated beneficiary shall be subject to Sections

401(a)(31), 402(f) and 3405(c) of the Internal Revenue Code of 1986,

as amended.

E. Effective for distributions after December 31, 2014, for

purposes of determining the portion of a disbursement of benefits

from the System to a Distributee that is not includable in gross

income under Section 72 of the Internal Revenue Code of 1986, as

amended, the guidance under I.R.S. Notice 2014-54 shall be followed.