WWiitthdhdrraawwaallss, , DDiissttrriibutbutiionsons, a, and Lnd Looaansns Taxable Portion You may elect to have all or part of the taxable portion of your DC account paid in the form of a direct rollover into an eligible 401(a), 403(b), or governmental 457(b) plan, or Traditional IRA, which has provisions allowing it to accept the rollover on your behalf. Except in the case of a Roth IRA, this option defers any taxes owed on the DC balance. If you choose to roll over only part of the taxable amount, the portion not rolled over is paid directly to you (less the mandatory 20% withholding for federal income tax). If you choose to take a rollover distribution and do not complete the rollover by the 60th day following the day on which you receive the distribution, your distribution may be subject to taxes and/or penalties unless you qualify for a waiver. You should consult a tax professional for waiver qualifications. Non-Taxable Portion You may choose to have all or part of the non-taxable portion of your DC paid as a direct rollover into a qualified plan. The percentage of taxable to non-taxable funds that are rolled over must reflect the same percentage as currently in the DC account. In other words, it cannot be all taxable or non-taxable unless the account only contains taxable funds. Those plans include a 403(b) plan, or Traditional or Roth IRA. If you roll over only part of the non-taxable amount, the portion not rolled over is paid directly to you. Paid Directly to You If you take the full distribution of your DC account, the full amount of taxable and non-taxable funds in your DC account will be distributed directly to you. INPRS will withhold 20% from your withdrawal of the taxable portion paid to you or to your surviving spouse. This is done whether or not the IRS imposes a 10% penalty. NOTE: You will receive a 1099-R after you receive your distribution. By law, January 31 is the latest date 1099-Rs can be mailed. Tax Penalty – Early Withdrawal of Your Defined Contribution Account You may be subject to an additional 10% federal tax penalty on your DC account if you have not reached the age of 59½ at the time of distribution and you do not meet any other exception. By January 31, of the year after you receive your distribution, you will receive a 1099-R. Teachers' Retirement Fund Hybrid Plan Member Page 28 of 47 Handbook Effective: 07/01/2024