Q. How do I become a participant in the Annuity Fund?
A. You will become a Participant when, within any period of 12 consecutive months, you are credited with 435 Hours of Service for which contributions are required to be made to the Annuity Fund. An Hour of Service is a legal term used to comply with federal law. It is an hour of sheet metal work performed for an Employer who is required to contribute to the Annuity Fund on your behalf under a collective bargaining agreement with Sheet Metal Workers' Local Union No. 80 for which you are paid or entitled to payment or any hour for which back pay is awarded for work you would have performed for your Employer.
Q. How do I become vested in my account?
A. Once you become a Participant you are 100% vested in the value of your Accrued Benefit Account.
Q. How much is my employer required to contribute?
A. That amount is determined by collective bargaining and depends on worker classification. At the time this information is being updated (November 2021), the contribution rate to the Annuity Fund for Construction Journeyman Participants is $2.01 per hour.
Q. Am I allowed to make additional contributions?
A. Yes, you may elect to have a portion of your hourly pre-tax wages contributed to the Fund. This is permitted under Section 401(k) of the Internal Revenue Code. You elect to do this by completing a “Salary Reduction Agreement” after becoming a Participant in the Plan (you have performed 435 hours of service for one or more employers in any period of 12 consecutive months under a collective bargaining agreement that requires your employer to contribute to this Annuity Fund) OR, if you have already satisfied those requirements, within seven days of when you begin working for an employer. For Participants under age 50, you may authorize your employer to deduct up to $9.00 (in $.50¢ increments) per hour from your pre-tax gross wages, which will be remitted to the Fund Office and deposited into your Annuity Fund account. For Participants age 50 and above, you may authorize your employer to deduct up to $13.00 (in $.50¢ increments) per hour from your pre-tax gross wages, which will be remitted to the Fund Office and deposited into your Annuity Fund account. Any portion of your contributions that is in excess of the IRS’ annual limit on elective deferrals will be designated as “catch-up contributions” for that year.
The total amount withheld cannot exceed the total yearly limit on elective deferrals provided in the IRS code. These amounts are set to comply with the limits established by the Internal Revenue Service and may be changed whenever the terms of the collective bargaining agreements change and at other times if the Board of Trustees determines it to be advisable to do so.
Please note that the Salary Reduction Agreement you enter into will continue until you receive your final weekly wage from that employer. However, you may elect to enter into, terminate or modify a Salary Reduction Agreement with an employer once per calendar year if you have been employed with that employer for more than six months.
There are many other restrictions placed by the Internal Revenue Service regarding the overall amount that may be added to your retirement or deferred compensation accruals in a Plan Year. The Fund monitors these restrictions closely and there might be occasions when the Fund may have to return some of your elective contributions to you in order to keep the Fund in compliance with the law (for example, if the amount of your elective contributions exceed the statutory limit). Also, the Fund is required to keep records of your gross wages for purposes of compliance with these restrictions.
Q. How will my contributions be invested?
A. The Annuity Fund has a self-directed investment program that is intended to constitute a plan described in Section 404(c) of the Employee Retirement Income Security Act of 1974, as amended (ERISA) and Title 29 of the Code of Federal Regulations Section 2550.404c-1. The fiduciaries of the plan may be relieved of liability for any losses that are the direct and necessary result of investment instructions given by a participant.
You have the right to direct the investment of your Accrued Benefit Account in any of the following options chosen and monitored by the Trustees in multiples of 1%, for a total of 100%.
FUND NAME: LIFESTYLE PORTFOLIOS:
John Hancock Stable Value Conservative Portfolio
Pioneer Bond Fund Conservative/Moderate Portfolio
Wester Asset Core Plus Bond Moderate Portfolio
American Century Mid Cap Value Moderate/Aggressive Portfolio
iShares S&P 500 Index Fund Aggressive Portfolio
JP Morgan U.S Research Enhanced Equity
Janus Henderson Enterprise
MFS Value
MassMutual Small Cap Opportunities
T. Rowe Price Blue Chip Growth
American Century Emerging Markets
WCM Focused International Growth
If for any reason you do not make an investment selection, your Account will be invested in the Moderate Portfolio, which directs the assets as 10% to cash or cash equivalent (stable value), 40% to bond funds and 50% to stock funds.
Q. How do I decide how to invest my Account?
A. The principal source of information on each investment option is its prospectus. A prospectus is a document which the mutual fund is required by the Securities and Exchange Commission to produce each year and which contains detailed information on investing style, past performance, fees, assets under investment, as well as other information. When you become a Participant, you will receive a complete set of prospectuses on all of the mutual funds available for self-directed investments from the recordkeeper, John Hancock. If the Trustees add a new optional fund, you will receive a prospectus on that new fund. You will also receive a prospectus whenever you elect to invest in a fund in which you have not previously invested. Finally, you are entitled to receive a prospectus for any fund at any time upon request by visiting the website at www.myplan.johnhancock.com or by contacting John Hancock at 833-38-UNION (833-388-6466). You are encouraged to seek out other sources of information as well.
Neither the Trustees, the Union Hall, nor the Fund Office will offer investment advice to participants. It is highly recommended that you seek the advice of an investment professional to assist in the decisions regarding the management of your money. You may also contact the Financial Advisor for the Annuity Fund, Tim Brice or Rebecca Wolfe at The Brice Group at (844) 467-2369, for retirement planning or investment allocations information.
Q. How will I know how much is in my account?
A. You will receive a statement on your Annuity Fund balance each quarter.
You may also access your account information via the Internet. The website address is www.myplan.johnhancock.com. To access accounts for the first time via the web, click “Register Now” and provide your Birth Date and Social Security Number. Here you will be able to review a snapshot of your account balance, investments, and recent transactional activity. The website will also allow you to change your investment options, transfer funds, view account performance and quarterly statements, change your PIN and more. Investment changes and transferring funds can ONLY be requested through the website or by contacting the recordkeeper, John Hancock, at 833-38-UNION (833-388-6466). Address changes for your statements and application requests MUST be made through the Fund Office (BeneSys).
You may also contact the Fund office for account information at 800-400-7710 during regular business hours of 7:30 a.m. to 4:30 p.m., Monday through Friday.
Q. Can I withdraw money from my Accrued Benefit Account?
A. The Annuity Plan is a retirement plan, not a savings account. Therefore, there are strict limitations on when money may be withdrawn from the Plan imposed by Federal law.
You are eligible to receive a distribution of your Accrued Benefit Account balance under the following conditions:
Retirement – If you are eligible for benefits from the Sheet Metal Workers' Local Union No. 80 Pension Trust Fund, you are eligible for retirement benefits from the Annuity Fund.
Disability – If you are totally and permanently disabled (if you are, based upon medical evidence, totally and permanently prevented by a physical or mental condition from engaging in further employment as a sheet metal worker) you are eligible for benefits from the Annuity Fund.
Separation from Service – If you work no hours in covered employment and the Fund receives no contributions (including any received as a reciprocity transfer) on your behalf for twelve consecutive months immediately prior to the commencement date of distribution and you do not do any work as a sheet metal worker in the geographic area covered by the Fund during that time (whether or not that work is for a covered employer), you will be considered to be separated from employment and entitled to apply for and receive benefits.
Death – Upon your death, your Accrued Benefit Account balance will be paid to your designated beneficiary. (Beneficiary designation forms are available from the Fund Office).
Q. What are some of the requirements for borrowing from the Annuity Fund?
A. You must have been a participant in the Plan for five or more years. You cannot have more than one loan outstanding at any time. If you have previously defaulted on a loan (which is reported to IRS as a “deemed distribution”), you can never borrow from the Fund again. If you are married, you cannot take a loan from the Fund without the written consent of your spouse.
The minimum loan amount is $2,000.00 and the maximum amount is 50% of your account balance (but no more than $50,000.00). If you have an outstanding loan balance within the previous 12 months, the $50,000 amount is reduced by the highest amount of any outstanding loan balance of the yours during the preceding 12 months.
Q. What is the interest rate?
A. The interest rate on your loan is a fixed percentage determined by the Trustees, acting on the advice of the Fund's depository bank.
Q. What is the payback period for my loan?
A. All loans must be repaid within five (5) years of the date the loan is made unless the loan is used for the purchase of your principal residence, in which case the period for repayment can exceed five years, but cannot exceed twenty (20) years.
Q. Where is the money for a loan coming from?
A. Your accrued benefit account secures the amount that you borrow. Your loan is treated as one of your investments in the Fund's Self-Directed Investment program, and the amount securing your loan cannot be invested in any other way while the loan is outstanding. The principal and the interest you pay are credited to your account.
Q. What documents must I sign to borrow from the Fund?
A. To apply for a loan, you must first fill out a loan application that you may request from the Fund office. This loan application will include a Spousal Consent form. If you are married, your spouse must consent to the loan and sign the Spousal Consent form before a notary public. If you are single, you must sign and have notarized a Statement of Single Status. In addition, if you were previously married, you must present a copy of your divorce decree.
If your loan application is approved, the Fund Office will submit the application to John Hancock for distribution. A Truth in Lending and Promissory Note will be sent with the terms of the loan, along with an amortization schedule to view the balance after each payment is applied.
Q. Where do I send my payments?
A. Loan payment checks can be made via ACH (Automatic Clearing House) through the John Hancock website, www.myplan.johnhancock.com. Once payments are set up through the website, it will automatically be deducted from your bank account until the loan is paid off. If you would prefer to mail a check, you will receive a monthly invoice to submit the payment. It should be made payable to JHRPS and mailed to P.O. Box 981072, Boston, MA 02298-1072
Q. Can I make additional payments to the principal or pay off the loan early?
A. Monthly scheduled payments may not include additional money to be applied to the principal or interest, nor any future payments. Federal Regulations require that payments be made in accordance with the loan schedule. However, you may pay the entire outstanding amount of your loan at any time, with no prepayment penalty. Please contact the Fund Office for an accurate pay-off amount and due date.
Q. Are there any penalties for late payment?
A. Yes. A payment received after the due date will be assessed a $10.00 late charge. An additional $10.00 will be added for each month the payment remains unpaid. If full monthly payment is not received, together with all accrued late charges when due, the loan shall be in default
Q. What happens if I default on my loan?
A. Once you have defaulted on your loan, there is a cure period a participant may take advantage of. The participant will have until the last day of the calendar quarter following the quarter in which a missed payment was due to cure the default. If the payment is made within that time frame, the loan will no longer be in default and the participant can continue making monthly payments as scheduled.
If, however, a missed payment (together will all accrued late charges) is not made on or before the last day of the calendar quarter following the calendar quarter in which the missed payment was due, the entire loan balance, including late fees and interest, shall be a deemed distribution from your Accrued Benefit Account and reported to the IRS as such. You will receive a copy of that notice from the IRS. This could result in serious tax consequences to you and your family. Once your loan is considered a deemed distribution, you can never borrow from the Fund again.
Q. Is borrowing from the Fund a good idea?
A. Neither the Fund Office personnel nor the Trustees are tax consultants. You are strongly advised to seek competent tax advice before you take a loan from the Fund.
Q. What are the requirements for an advance distribution based on hardship?
A. If the Fund determines, based upon satisfactory evidence, that you have an immediate and heavy financial need, as defined below, you shall be entitled to receive a distribution from your Accrued Benefit Account in an amount not to exceed the amount necessary to satisfy your immediate and heavy financial need, plus taxes you anticipate you will owe as a result of this distribution.
A distribution is deemed to be on account of an immediate and heavy financial need only if the distribution is for one of the following reasons, which are regulated by the IRS:
a) Expenses for medical care previously incurred by you, your spouse, or any of your dependents or necessary for these persons to obtain medical care that is deductible under Internal Revenue Code Section 213;
b) Costs directly related to the purchase of your principal residence (excluding mortgage payments);
c) Payment of tuition, related educational fees, and room and board expenses, for the next 12 months of post-secondary education for you, your spouse, children, or legal dependents;
d) Payments necessary to prevent the forfeiture of, eviction from or tax or mortgage foreclosure on, your principal residence;
e) Funeral or burial expenses for your spouse, parent, child, or legal dependent; or
f) Expenses for the repair of damage to your principal residence that would qualify for the casualty deduction under the Internal Revenue Code.
No hardship distribution shall be made unless the Fund, based upon your representations and such other facts as are known to the Fund, determine that each of the following conditions is satisfied:
a) You have not received a hardship distribution during the prior 12 months;
b) The distribution is not in excess of the amount of the immediate and heavy financial need, which may include any amounts necessary to pay any federal, state, or local taxes or penalties reasonably anticipated to result from the distribution;
c) You have obtained all distributions, other than hardship distributions, and all other nontaxable (at the time of the loan) loans currently available under this and any plans in which you participate; and
Any hardship distribution shall be payable in a single lump sum, upon submission of an application to the Fund and accompanied by such other data or documents as may be required by it and is subject to all applicable spousal notice and consent requirements.
Employer contributions based on work performed less than twenty-four months prior to the first day of the month immediately preceding the date of the hardship distribution and/or based on work performed prior to January 14, 2004, including any earnings on those contributions, are not available for an advance distribution for hardship.
Advance distributions for hardship are not eligible rollover distributions.