The following guidelines for complying with qualified plan benefit limitations imposed by I.R.C. § 415 shall be followed in accordance with Acts 1995, No. 739:

1. (1) Total employer financed straight life annuity payments to any retired member in any calendar year shall not exceed the dollar limit specified in I.R.C. § 415;
2. (2) In any calendar year in which the total straight life annuity payments otherwise payable would exceed the amount permitted under I.R.C. § 415, the actual amount paid shall be reduced by such dollar difference; and

3. (3) A retiree whose benefits are reduced in accordance with I.R.C. § 415, limitations in any calendar year will be retested in subsequent years in accordance with the following objectives:

   1. (A) Assurance that the Arkansas Public Employees’ Retirement System will remain in compliance with I.R.C. § 415; and
   2. (B) The smallest acceptable cumulative adjustments are made to the benefits paid to any retired member.

Codification Notes: I.R.C. § 415 is codified at 26 U.S.C. § 415. This section as promulgated prior to codification into the Code of Arkansas Rules provided as follows: "212– 1995 (8) – Compliance with Benefit Limits Imposed by Section 415 of the Internal Revenue Code (as amended May 1998)"