Other Retirement Benefit Provisions
Lump Sum Distributions
If you had a vested benefit from the Retirement Plan and the lump sum present value of your Final Pay pension benefit was less than a specified dollar amount (currently $5,000) as of the date you left the Company or retired, you had the option to elect to receive a single cash payment shortly after your employment ended or to elect to roll over the distribution to a tax-deferred plan.
If you had a vested Cash Balance Pension benefit, you had the option as of the date you left the Company or retired to receive the benefit in a single lump sum payment, or to elect to roll over the distribution to a tax-deferred plan.
If you were eligible, you received a written explanation about rollover options prior to receiving your distribution from the Retirement Plan. If you elected to roll over your distribution into an IRA, the entire taxable portion of your refund was issued in a check made payable to your IRA. You will only be taxed when you withdraw these funds from your IRA.
Minimum Distributions
Federal law imposes a minimum benefit amount that you must receive each year. This requirement typically applies if your first benefit payment begins after age 70-1/2. The purpose of the law is to make sure individuals entitled to receive a benefit actually receive it during their lifetime. If you delay the start of your pension, and you are subject to the minimum distribution requirements, the Plan Administrator will calculate the amount of your benefit that will satisfy the minimum distribution requirement for the Retirement Plan. If you participate in other plans, including the PG&E Corporation Retirement Savings Plans or any personal IRAs, the minimum distribution requirements for those plans or retirement accounts must be satisfied independently of the requirements for the Retirement Plan.
Past Employee Contributions to the Retirement Plan
This provision applies only to participants who were employed before 1973. If you made contributions to the Retirement Plan and had a vested benefit, you had the option at your retirement or termination of employment to withdraw these contributions, plus interest, or leave them in the Retirement Plan.
  • If you left your contributions in the Retirement Plan, you received the full pension to which you were entitled.
  • If you withdrew your contributions, the pension you received was reduced by the actuarial value of the contributions withdrawn.
Please note that although the Retirement Plan rules allowed you to withdraw an amount equal to your contributions plus accrued interest, tax laws no longer allow you to consider the portion of the refund equal to your contributions as non-taxable.
Previous tax laws allowed retirees who elected not to withdraw their contributions to receive benefits tax-free until the sum of their contributions was returned. However, for those who retired after August 1, 1987, each monthly pension benefit contained prorated amounts of both the employee contributions, which have already been taxed, and Company contributions which are taxable. In this way, employee contributions are paid back over the retiree's expected lifetime (as actuarially determined).
If You DID NOT Withdraw Contributions from the Retirement Plan
If you did not elect to withdraw your contributions at the time of your retirement and you die before your total pension payments equal your contributions plus interest, the following action will be taken:
  • If you elected a marital or joint pension, part of the monthly pension benefit continues to be paid tax-free until your spouse/joint pensioner has received the remaining credit for all your after-tax contributions.
  • If you did not elect a marital or joint pension, the remaining balance of your contributions plus interest will be paid to your designated beneficiary.
If the sum of the pension payments you received before you died is greater than your contributions plus interest, but you had not yet received the entire tax-free portion of your contributions to the Retirement Plan, your final 1099-R statement will reflect the remaining nontaxable amount.
If You Withdrew Your Contributions from the Retirement Plan
At retirement, you had the option of withdrawing your contributions plus interest for your own use, and you may have had the option of rolling your contributions into an Individual Retirement Account (IRA). If you elected to withdraw your contributions from the Retirement Plan, your pension benefit was actuarially reduced.
Although you made your contributions with after-tax dollars, tax laws prohibited you from receiving all of your refund tax-free. If you withdrew your contributions for your own use, you were required to pay taxes on your entire refund, and in turn, part of your monthly benefit is paid out tax-free until you have received credit for all of your after-tax contributions. In the event of your death, any remaining tax-free amount is reported on your final 1099-R statement.
Participants were provided with a written explanation about rollover options for refunded contributions when they retired. If contributions were rolled over into an IRA, the entire taxable portion of your refund was issued in a check made payable to your IRA. You will only be taxed when you withdraw these funds from your IRA.