PUBLIC AGENCY RETIREMENT SERVICES (PARS) - 2011

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distribution. A portion of a distribution shall not fail to be an eligible rollover distribution merely because the portion consists of after -tax employee contributions which are not includible in gross income. However, such portion may be transferred only: (A) to an individual retirement account or annuity described in Section 408(a) or (b) of the Code, a Roth IRA described in Section 408A of the Code or (B) to a qualified defined contribution, defined benefit or annuity plan described in Section 401(a) of the Code or Section 403(b) of the Code, that agrees to separately account for amounts so transferred (and earnings thereon), including separately accounting for the portion of the distribution that is ineludible in gross income and the portion of the distribution that is not so includible. (B) Eligible Retirement Plan An eligible retirement plan is an individual retirement account described in Section 408(a) of the Code, an individual retirement annuity described in Section 408(b) of the Code, a qualified plan described in Section 401(a) of the Code that accepts the distributee's eligible rollover distribution, an annuity contract described in Section 403(b) of the Code, a Roth IRA described in Section 408A of the Code and an eligible plan under Section 457(b) of the Code 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 this Plan, The definition of eligible retirement plan shall also apply in the case of a distribution to a surviving spouse, or to a spouse or former spouse who is the alternate payee under a qualified domestic relation order, as defined in Section 41.4(p) of the Code. (C) Direct Rollover A direct rollover is a payment by the Plan to the eligible retirement plan specified by the distributes. N131:790420.2 20