SB188: State and local employees; deferred compensation plans.
SENATE BILL NO. 188
Be it enacted by the General Assembly of Virginia:
1. That §§ 51.1-600 and 51.1-604 of the Code of Virginia are amended and reenacted as follows:
§ 51.1-600. Definitions.
As used in this chapter, unless the context requires a different meaning:
"Act" means the Government Employees Deferred Compensation Plan Act.
"Board" means the Board of Trustees of the Virginia Retirement System.
"Deferred compensation plan" means a plan by which an employee defers some portion of income
until some stated time in the future; provides that the federal and state
income tax on such income will be deferred until the actual receipt of such
income; and is established pursuant to the provisions of §
457(b) of the Internal Revenue
Code of 1986, as amended, that may provide for
elective and non-elective deferrals of compensation by or on behalf of
employees and may include a qualified Roth contribution program as
described in § 402A of the Internal Revenue Code of 1986, as amended.
"Employee" means, in the case of the plan described in § 51.1-602, all persons employed by a participating employer, including appointed or elected officials. In the case of a plan adopted by a county, municipality, authority or other political subdivision pursuant to § 51.1-603, an employee shall be defined by such county, municipality, authority or other political subdivision.
"Participating employer" means the Commonwealth or any political subdivision that has elected pursuant to § 51.1-603.1 to participate in the deferred compensation plan established by the Board pursuant to this chapter.
§ 51.1-604. Standards for deferred compensation plans.
No deferred compensation plan shall become effective until the
Board, county, municipality, authority or other political subdivision of the
Commonwealth is satisfied, by opinion of its respective counsel,
such federal agency or agencies as may be deemed necessary, or otherwise, that
the compensation deferred contributions thereunder
and/or the investment products purchased pursuant to the plan (i) will not be
included in the employee's taxable income under federal or state law until it
is actually received by the employee under the terms of the plan and (ii), provided
that such compensation contributions will nonetheless
be deemed compensation at the time of deferral for the purposes of social
security coverage, for the purposes of the Virginia Retirement System, and for
any other retirement, pension, or benefit program established by law, or (ii) are designated Roth contributions as
defined in § 402A of the Internal Revenue Code
of 1986, as amended.
2. That the provisions of this act shall become effective on July 1, 2015.