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System is calculated by taking into account petitioner's "average
final compensation" and petitioner's years of "creditable
service". Md. Ann. Code, art. 73B, sec. 145(2) (1988). Because
section 402(e)(4)(C) requires that we treat the Retirement System
and the Pension System as a single pension plan, we conclude
that, by transferring from the Retirement System to the Pension
System, petitioner did not forfeit his right to a future monthly
annuity, but simply elected to receive an initial single payment
to be followed by a reduced monthly annuity. Effectively,
petitioner's transfer allowed him to receive the "balance to the
credit" in two parts, an initial single payment to be followed by
a reduced monthly annuity, based on all of his years of
creditable service, and on his salary during those years. See
Green v. Commissioner, T.C. Memo. 1994-340.
The testimony of petitioner at trial reflects the foregoing.
Thus:
Q: * * * And you transferred to that Pension
System from the Retirement System in 1990; is that
correct?
A: Yes, sir.
Q: Okay. Do you know how your pension annuity is
currently calculated?
A: It's calculated on your number of years in
service and what your salary was.
Q: Okay. And do you know that your annuity was
calculated based on all of the years of service that
you had, the entire time you've been employed with the
State of Maryland?
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