Texas Register, Volume 11, Number 41, Pages 2491-2534, May 30, 1986 Page: 2,506
2491-2534 p. ; 28 cm.View a full description of this periodical.
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Ms. Dillard also has determined that for
each year of the first five years the sec-
tions are in effect the public benefit anti-
cipated as a result of enforcing the sec-
tions will be the establishment of sections
that are consistent with state law. There
is no anticipated economic cost to indi-
viduals who are required to comply with
the proposed sections.
Comments on the proposal may be sub-
mitted to Linda Logan, Rules Coordinator,
TDMHMR, P.O. Box 12668, Austin, Texas
78711, within 30 days of publication In the
Texas Register.
The amendments are proposed under 1bxas
Civil Statutes, Article 5547-202, which pro-
vide the Texas Board of Mental Health and
Mental Retardation with rulemaking powers.
t403.322. Application. The provisions of
this subchapter apply to:
(1) (No change.)
(2) those companies and their rep-
resentatives who undertake [authorized by
the Texas Department of Mental Health and
Mental Retardation] to sell tax-sheltered an-
nuities [to department employees insofar as
such companies and their representatives
undertake to sell such annuities] to employees
of the department; and
(3) those companies and their rep-
resentatives interested in selling [applying for
authorization to sell] tax-sheltered annuities
to employees of the department.
403.323. Definitions. The following words
and terms, when used in this subchapter,
shall have the following meanings, unless the
context clearly indicates otherwise.
Contract-The agreement between
[the department and] an insurance company
and an employee who is participating in the
department's TSA program [authorized under
this subchapter to participate in the depart-
ment TSA program].
TSA application-The application
for the purchase of annuity benefits submitted
by an employee to an insurance company
[authorized under this subchapter to parti-
cipate in the department TSA program] on
forms supplied by the company.
403.324. Appointment of a Tax-Sheltered
Annuity Committee; Terms of Members;
Replacement of Members Unable to Serve;
Duties of the Committee; Facility Respon-
sibility.
(a) A tax-sheltered annuity committee
shall be appointed by the commissioner from
among the employees of the department. The
committee shall consist of five [nine] mem-
bers. The commissioner shall name the chair-
person of the committee.
(b) Each member shall serve a term
not to exceed three years or until a successor
is appointed. Each August 31 the terms of
one or two [three] members of the commit-
tee shall expire.
(c) (No change.)
(d) The tax-sheltered annuity commit-
tee shall:(1)-(2) (No change.)
[(3) review the annuity products cur-
rently being offered by companies participat-
ing in the department TSA program; and
[(4) review the annuity products cur-
rently being offered by companies desiring
to participate in the department TSA pro-
gram and recommend for participation in the
department TSA program those companies
whose products meet the criteria set out in
403.332 of this title (relating to Company
and Company Representatives).]
(e) The chairperson shall designate
members of the committee to monitor the
selection and performance of the insurance
agents assigned to the program, handle in-
quiries from facility staff concerning the pro-
gram, monitor compliance with federal re-
quirements and department rules, prepare
annual reports on participation in the pro-
grain, and respond to inquiries [analyze bids
submitted] by companies desiring to parti-
cipate in the program.
(f) (No change.)
403.325. Employee Participation: General
Information Concerning the Tax-Sheltered
Annuity Program of the Department.
(a)-(b) (No change.)
(c) TSA agreements will provide that
an employee's salary will be reduced in equal
monthly installments. Withholding tax will
be based upon the employee's gross compen-
sation after the salary reduction. Deductions
for social security and retirement contribu-
tions will be calculated on the amount of
gross compensation before the salary reduc-
tion and, therefore, are not affected by the
purchase of a tax-sheltered annuity. [Suffi-
cient monthly salary must remain after the
salary reduction to meet social security, re-
tirement, and income tax withholding obliga-
tions.] The employee must [also] insure that
sufficient monthly salary remains for [other]
existing or anticipated payroll deductions
[since there is no medium through which
such payments may be regularly made ex-
cept through payroll deductions].
(d) The Internal Revenue Code of 1954,
as amended, governs the amount of an em-
ployee's monthly compensation that may be
deferred in a TSA program. The maximum
amount of an employee's monthly compen-
sation that may be deferred is determined by
the preparation of the exclusion allowance
worksheet. Participation in the State Deferred
Compensation Program reduces the monthly
amount for exclusion allowance purposes
under a TSA program [by the amount of the
Deferred Compensation Program salary re-
duction]. If an employee is participating in
the department TSA program and the State
Deferred Compensation Plan I, the combined
maximum amount that may be deferred is
25% of gross compensation but not more
than $7,500 annually.
(e) Ownership of TSA purchases is re-
tained by the employee; however, the em-
ployee cannot offer his TSA account as se-
curity for a loan except to his TSA company,and he cannot transfer or assign the account
to a third party.
(f) (No change.)
403.326. Employment P) ticipgation* bavl-
ment.
(a) (No change.)
(b) Enrollment is accomplished by the
following:
(1) (No change.)
(2) Preaentation of a disclosure form
to the employee by the representative.
(3) [(2)] Completion of a TSA ap-
plication on a form furnished by the com-
pany representative.
(4) [(3)] Completion of a TSA agree-
ment by the employee.
(5) [(4)] Signature of the designated
official of the department facility by which
the employee is employed on the TSA agree-
ment prior to the first day of the month in
which the agreement is to become effective.
(c) An employee may enter into no
more than one TSA agreement amount to
become effective in the same calendar year,
but he may also change companies.
(d) An employee may designate that
his contribution be used to purchase fixed
annuities, [or] variable annuities, or com-
pany mutual funds [both], but an employee
may not designate that such purchases will
be made from more than one company at
a time.
403.328. Employee Participation: Amend-
ment. A TSA agreement may be amend-
ed at any time to increase or decrease the
amount of salary reduction and to make a
corresponding increase or decrease in the
amount of contributions to an annuity plan;
provided, however, that an employee may
enter into no more than one TSA agreement,
whether an original agreement or an amend-
ment to an existing agreement, to become
effective in the same calendar year, not-
withstanding a second TSA agreement with-
out change in amount may be made to change
companies.
403.330. Employee Participation: Cancel-
lation.
(a) An employee may [cancel his TSA
agreement] at any time submit [by submit-
ting] a written request on the department
form "Cancellation of Tax-Sheltered Annui-
ty," (Form P-28), which is referred to as Ex-
hibit C, to cancel the [such] agreement, ef-
fective as of the first day of any month fol-
lowing the date of the request. (See 403.334
of this title (relating to Exhibits).) In the
event of such cancellation, a new TSA agree-
ment may not be made to take effect prior
to the first day of the next calendar year
following the effective date of the cancel-
lation.
(b) Termination of employment with
the department will [automatically] cancel
the TSA agreement effective upon the last
date of employment for payroll purposes.
Upon such termination the employee may
either withdraw the value of the employee's11 TexReg 2506 May 30, 1986 Texas Register 4
Texas Register 4P
11 TexReg 2506 May 30, 1986
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Texas. Secretary of State. Texas Register, Volume 11, Number 41, Pages 2491-2534, May 30, 1986, periodical, May 30, 1986; Austin, Texas. (https://texashistory.unt.edu/ark:/67531/metapth243789/m1/16/: accessed May 1, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting UNT Libraries Government Documents Department.