(b) “Direct rollover” means a payment by the State Retirement Agency directly to the eligible retirement plan specified by the participant, the surviving spouse of a participant, or the designated beneficiary of the participant.

(c) “Eligible retirement plan” means:

(1) an individual retirement account described in § 408(a) of the Internal Revenue Code;

(2) an individual retirement annuity, other than an endowment contract, described in § 408(b) of the Internal Revenue Code;

(3) a qualified trust described in § 401(a) of the Internal Revenue Code that is exempt from tax under § 501(a) of the Internal Revenue Code;

(4) an annuity plan described in § 403(a) of the Internal Revenue Code;

(5) an annuity plan described in § 403(b) of the Internal Revenue Code;

(6) a deferred compensation plan described in § 457(b) of the Internal Revenue Code, or any successor provisions, that is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or a political subdivision of a state that agrees to account separately for amounts transferred into that plan; or

(7) effective January 1, 2008, a Roth Individual Retirement Account described in § 408A of the Internal Revenue Code.

(d) (1) “Eligible rollover distribution” means a distribution:

(i) on or after January 1, 1993, to a participant of all or any part of the balance to the credit of the participant in any State system;

(ii) on or after January 1, 2002, to the surviving spouse of a member, former member, or retiree, or to a spouse or former spouse who is an alternate payee under an eligible domestic relations order, as defined in § 414(p) of the Internal Revenue Code, of all or any part of the balance to the credit of the member, former member, retiree, or surviving spouse in any State system; or

(iii) on or after January 1, 2007, to the designated nonspouse beneficiary of a member, former member, or retiree of all or any part of the balance to the credit of the member, former member, retiree, or designated nonspouse beneficiary in any State system.

(2) “Eligible rollover distribution” does not include:

(i) any distribution that is one of a series of substantially equal periodic payments that are made at least annually for the life or life expectancy of the participant or the joint lives or joint life expectancies of the participant and the participant’s beneficiary;

(ii) any distribution that is one of a series of substantially equal periodic payments made for a specified period of at least 10 years;

(iii) any distribution that is required under § 401(a)(9) of the Internal Revenue Code;

(iv) any distribution that is reasonably expected to total less than $200 during the calendar year; or

(v) any other distribution that the Internal Revenue Service does not consider eligible for rollover treatment, including corrective distributions necessary to comply with the provisions of § 415 of the Internal Revenue Code.

(3) (i) Effective January 1, 2002, a portion of a distribution will not fail to be an eligible rollover distribution merely because that portion consists of after-tax employee contributions that are not includible in gross income.

(ii) A portion of a distribution described in subparagraph (i) of this paragraph may be transferred only to:

1. an individual retirement account or annuity described in § 408(a) or (b) of the Internal Revenue Code;

2. a qualified defined contribution plan described in § 401(a) of the Internal Revenue Code that agrees to account separately for amounts transferred to the account and earnings received as a result of the transferred amounts;

3. on or after January 1, 2007, to a qualified defined benefit plan described in § 401(a) of the Internal Revenue Code or to an annuity contract described in § 403(b) of the Internal Revenue Code, that agrees to account separately for amounts transferred to the account and earnings received as a result of the transferred amounts; or

4. on or after January 1, 2008, to a Roth IRA described in § 408 of the Internal Revenue Code.

(iii) A transfer to an eligible retirement plan described in subparagraph (ii)2, 3, or 4 may be made only through a direct rollover.

(e) “Supplemental plan” means the Board of Trustees of the Maryland Teachers and State Employees Supplemental Retirement Plans.