Authority: IC 5-10.5-4-2

Affected: IC 4-21.5; IC 5-10.2; IC 5-10.3

Sec. 10. (a) This rule applies to all trust funds administered by INPRS. Monthly benefit payments to a member, survivor, and beneficiary may be withheld under any of the following circumstances:

1. (1) To offset the overpayment of benefits to a member, survivor, or beneficiary until the overpayment is repaid to the fund consistent with subsection (c).

2. (2) Pending investigation after any of the following occur:

   1. (A) Three (3) consecutive monthly benefit checks have not been cashed.
   2. (B) Three (3) consecutive monthly benefit payments have been deposited on a stored value card that has not been activated.
   3. (C) One (1) direct deposit monthly benefit payment has been rejected by the member's, survivor's, or beneficiary's financial institution.
3. (3) After receiving notification of the death of a member, survivor, or beneficiary.

(b) If INPRS determines that an overpayment of a member's, survivor's, or beneficiary's benefit is to be collected from ongoing monthly benefit payments:

1. (1) INPRS shall provide not less than sixty (60) days' notice of the existence of an overpayment and INPRS' intent to collect said overpayment from the member, survivor, or beneficiary;

2. (2) INPRS shall not require an amount greater than:

   1. (A) twenty-five percent (25%) of the total monthly benefit to be withheld; or
   2. (B) ten percent (10%) of the total monthly benefit to be withheld, if the overpayment began prior to July 1, 2015, and the overpayment occurred through no fault of the member, survivor, or beneficiary;
3. (3) if no agreement on the amount to be withheld can be reached, or sixty (60) days has passed from the issuance of the notice of overpayment, pursuant to the process described in subdivision (1), INPRS shall withhold the amount described in subdivision (2); and
4. (4) a member, survivor, or beneficiary may request INPRS reduce the amount being withheld from an ongoing monthly benefit due to a financial hardship on a form approved by INPRS. If INPRS determines a hardship exists, INPRS shall grant such requests.

(c) If a member, survivor, or beneficiary receives an overpayment of benefits, the member, survivor, and beneficiary have an obligation to repay the erroneous payments to the fund.

(Board of Trustees of the Indiana Public Retirement System; 35 IAC 1.2-6-10; adopted Nov 19, 2010: 20101208-IR-035100722ONA; adopted Sep 10, 2021: 20210915-IR-035210420ONA)