PENSION PROTECTION ACT OF 2006

The Pension Protection Act of 2006 has made some changes to the way disbursements can be made from Plan B and DROP Back accounts for the Firefighters of Oklahoma.  Previously, a member had to be 55 years of age or older in the year they actually retired from their local fire department to make withdrawals from their deferred pension accounts without the 10% tax penalty.  The new Pension Protection Act of 2006 rolled that age back to 50.  As of August 18, 2006, if you were/are 50 years of age or older in the year that you retire, you can make withdrawals from your account without the 10% tax penalty.  This Act does not change the 59 ½ age if you were not 50 or older in the year that you retired.  Therefore, if you retire at 48 years of age, you still have to wait until you reach 59 ½ years of age before you can make withdrawals from your account without the penalty.  There has been a lot of confusion on this matter.  If you have questions concerning this matter please contact this office before making a decision that could possibly cost you an additional 10% penalty.