Payment options

If you are vested when you leave BP, you can choose to receive your plan benefit or (if the value of your account is greater than $5,000) wait to receive your benefit at a later date. If you defer payments, your account will continue to receive regular interest credits up until your commencement date.

If you receive a ...
This is how it's paid ...
Lump sum payment
The full value of your plan benefit (or Total Account Balance) in a single cash payment. This payment will be subject to 20% federal tax withholding, which may be deferred by rolling it over into the BP Employee Savings Plan, an Individual Retirement Account (IRA) or the qualified plan of another employer. (If your account balance is $5,000 or less, see Automatic distribution or rollover of benefits valued at $5,000 or less.)
Partial lump sum 50% of the value of your plan benefit (or Total Account Balance) in a single cash payment and 50% of either the single life annuity, 50% or 100% Joint and Survivor annuity commencing at the same time.
Single life annuity
A fixed monthly benefit for your lifetime, beginning upon your benefit commencement date, with no additional benefits payable upon death.
Joint and survivor annuity
A reduced lifetime monthly benefit based on the life expectancy of you and your joint annuitant beneficiary. Upon your death, the joint annuitant beneficiary will receive a lifetime monthly benefit at the elected level (50%, 75% or 100%). If the joint annuitant beneficiary predeceases you, no further payments are due after your death.

All benefit conversions to optional forms of payment will be done using the applicable mortality table and interest rate. See Calculation factors under Important terms for more details.

Additional payment options may be available to some BP, Amoco, ARCO, Master Hourly and Castrol heritage employees. Please contact BP Retirement Services at Fidelity at 1-877-272-3334 for more information.

Lump sum payment

If you're married, your spouse must provide written and notarized consent to your election of a lump sum. By consenting to the lump sum option, your spouse is waiving all rights to a separate benefit for himself/herself in the event of your death.

Single life annuity

The single life annuity is the standard form of payment for single employees. Electing a single life annuity means that you'll receive a guaranteed monthly benefit that ends when you die. After your death, no additional payments will be made to your beneficiary(ies).

If you're married and elect a single life annuity, your spouse must provide written and notarized consent to your election. By consenting to the single life annuity, your spouse is waiving all rights to a separate benefit in the event of your death.

Under the cash balance formula, your single life annuity is determined by taking the lump sum value of your cash balance account and converting it to an annuity. To do this, the plan uses the applicable mortality table and the applicable interest rates. See Important terms for additional information.

Joint and survivor annuity

The joint and survivor annuity is the standard form of payment for married employees. If you elect a joint and survivor annuity, you'll receive a reduced monthly benefit over your lifetime. After your death, your joint annuitant will continue to receive a benefit for his/her lifetime.

You can elect a 50%, 75% or 100% joint and survivor annuity. If you elect a 50% joint and survivor annuity, your joint annuitant will receive 50% of the monthly benefit you were receiving before your death.

If you're married and elect a joint and survivor annuity with someone other than your spouse as your joint annuitant, your spouse must provide written and notarized consent to your election. Your spouse is waiving all rights to a separate benefit in the event of your death by consenting to the joint and survivor annuity paid to someone else.

Under the cash balance formula, to convert the value of your cash balance account to a joint and survivor annuity, your balance is first converted to a single life annuity. To do this, the plan uses the applicable mortality table and the applicable interest rates. See Important terms under Receiving your benefits for additional information.

Your joint annuitant cannot be changed after your benefit commencement date. If your spouse is the joint annuitant and you separate or divorce after you begin receiving your joint and survivor payments, your former spouse continues to be entitled to the survivor annuity benefit, even if you or your former spouse later remarries.

Automatic distribution or rollover of benefits valued at $5,000 or less

If your vested plan benefit is valued at $5,000 or less when you leave the company, and you do not initiate a distribution, you will receive an automatic lump sum distribution of your vested plan benefit. This one-time payment is eligible for a direct rollover into an Individual Retirement Account (IRA), another tax-qualified plan or an eligible employer plan.

If you do not initiate a rollover or distribution, your lump sum benefit will be paid out as follows:

  • Benefits valued at greater than $1,000 but not more than $5,000: The Internal Revenue Code (IRC) requires that your lump sum payment be rolled over into a qualified IRA which will delay you having to pay taxes on the benefit.


  • The lump sum will be rolled over into a Fidelity Rollover IRA in your name and will be invested in the Fidelity Cash Reserves Fund (FDRXX), a money market vehicle designed to preserve principal and provide a reasonable rate of return and liquidity. The Cash Reserves Fund investment management fees will be charged to your IRA and will not be paid by BP or the plan(s).

    If one of these IRAs is established for you, Fidelity will provide you information about your account. No further benefits will be payable from the plan.

    To learn more about this IRA, call BP Retirement Services at Fidelity at 1-877-272-3334 on any business day (except New York Stock Exchange holidays) between 7:30 A.M. and 11:00 P.M. central time.

  • Benefits valued at $1,000 or less: If your vested account value is $1,000 or less, a check for the entire amount of the lump sum will be sent to you with the required 20% federal income tax withheld. Additional state taxes will also be withheld, if applicable. No further benefits will be payable from the plan.

Deferring your retirement payment

If the value of your plan benefit is greater than $5,000, you can elect to leave your benefit in the plan until April 1st of the year following the year you reach age 70½. Your cash balance account will continue to earn regular interest credits up until your commencement date. When you decide to request payment of your plan benefit, contact BP Retirement Services at Fidelity. If you do not elect a distribution, your benefit will be paid out in the normal form of annuity.

If you don't contact BP Retirement Services at Fidelity before reaching age 65, a notice will be sent to you approximately three months before your 65th birthday. It will inform you that you're eligible for retirement benefits and advise you to contact BP Retirement Services at Fidelity when you wish to begin receiving benefits.

If you haven't made a payment election by age 70, you'll receive a Notice of a Minimum Required Distribution asking you to contact BP Retirement Services at Fidelity to initiate payment.

 

Publication date: June 2018

 

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