Death After Retirement

When you selected a payment option at retirement, you decided what kind of death benefits your beneficiary(ies) would receive. However, benefits are not paid automatically upon your death.

Applying for death benefits

To receive death benefits, your beneficiary(ies) must file an application with IPERS and provide the necessary supporting paperwork. 

Generally, your designated beneficiary(ies) must apply for the death benefit within five years from the date of your death or the benefit is forfeited. A longer period may apply if your spouse is your designated beneficiary. A shorter claim period may also apply, depending on the application of the Internal Revenue Service's (IRS) minimum distribution rules to your situation. 

If you die after you receive your first retirement benefit payment, the amount (if any) of the death benefit depends on the benefit payment option you selected at retirement. 

If you die before you receive your first retirement benefit payment, your benefit application will be canceled and a preretirement death benefit will be payable to your beneficiary.

It's a good idea to discuss IPERS death benefits with your beneficiaries. Stress the importance of notifying IPERS of your death as soon as possible and completing an application for remaining death benefits, if applicable.

Payments to minors

IPERS cannot make payments directly to minors. If the amount to be paid to the minor is under $25,000, payment may be made to an adult as custodian for the minor. If the amount is $25,000 or more, the amount must be paid to a court established conservator or trustee. Alternatively, if the minor will turn 18 within the applicable time period for making a distribution, the minor can wait and apply upon reaching age 18. Contact IPERS to ensure that waiting to claim a death benefit will not cause the death benefit to be forfeited.

Amounts payable to beneficiaries who fail to file claims

If you have multiple beneficiaries or heirs, it is possible that some may not apply for benefits within the required claim period. If this happens, IPERS divides the shares amongst all beneficiaries on a prorated basis.

Rollovers

Federal law permits a member’s current or former spouse to roll over the taxable portion of a lump-sum death benefit to a traditional IRA or an eligible retirement plan, which includes plans qualified under section 401(a) of the Internal Revenue Code (IRC). After-tax amounts may be eligible for rollover transfers. Rolling over the taxable portion to another retirement plan or an IRA allows the funds to continue to grow on a tax-deferred basis until the current or former spouse retires. Nonspouse beneficiaries have the same rollover rights as spouses, except their rollovers can only be made to IRAs that follow inherited IRA rules.

Remember to keep your IPERS Beneficiary Designation form current. If your beneficiary dies before you die and you do not name a new beneficiary, or if you have not designated a beneficiary, your death benefit may become payable to your estate. Or your benefits may pass in accordance with Iowa’s laws on intestate succession if no estate will be opened.

Report a death

Please notify IPERS as soon as possible after a death, as this will help ensure that benefits are paid properly and quickly. Benefits are paid according to the most recent beneficiary designation on file with IPERS.