Current through Register Vol. 47, No. 6, September 18, 2024
(1) Effective July
1, 1998, the monthly benefit payments for a member under the age of 65 who has
a bona fide retirement and is then reemployed in covered employment shall be
reduced by 50 cents for each dollar the member earns in excess of the annual
limit. Effective March 23, 2022, this reduction is not required until the
member earns the amount of remuneration permitted for a calendar year as
defined in Iowa Code section
97B.48A. The foregoing reduction
shall apply only to IPERS benefits payable for the applicable year that the
member has reemployment earnings and after the earnings limit has been reached.
Said reductions shall be applied as provided in subrule 12.7(2).
Effective January 1, 1991, this earnings limitation does not
apply to covered employment as an elected official. A member aged 65 or older
who has completed at least four full calendar months of bona fide retirement
and is later reemployed in covered employment shall not be subject to any
wage-earning disqualification.
(2) Beginning on or after July 1, 1996, the
retirement allowance of a member subject to reduction pursuant to subrule
12.7(1) shall be reduced as follows:
a. A
member's monthly retirement allowance in the following calendar year shall be
reduced by the excess benefit paid in the preceding year after the excess
benefit payment amount has been determined.
b. Employers shall be required to complete
IPERS wage reporting forms for reemployed individuals which shall reflect the
prior year's wage payments on a month-to-month basis. These reports shall be
used by IPERS to determine the amount which must be recovered to offset
overpayments in the prior calendar year due to reemployment wages.
c. The member's overpayment shall be
collected as follows:
(1) IPERS will reduce
the member's gross monthly benefit by 50 percent until the overpayment is
repaid. If the 50 percent reduction will not recover the overpayment by the end
of the current calendar year, IPERS will calculate the monthly reduction amount
so that the overpayment will be recovered within the current calendar year.
Other monthly reduction amounts may be made by an agreement in writing between
the member and IPERS; or
(2) A
member may elect to make repayments of the overpayment amounts out of pocket in
lieu of having the member's monthly benefit reduced. An out-of-pocket repayment
may be made in one check or in installments. However, an election to make
repayment in installments must be agreed to in writing between the member and
IPERS.
(3) If a member dies and the
full amount of overpayment determined under this subrule has not been repaid,
the remaining amounts shall be deducted from the payments to be made, if any,
to the member's designated beneficiary or contingent annuitant. If the member
has selected an option under which there are no remaining amounts to be paid,
or the remaining amounts are insufficient, the unrecovered amounts shall be a
charge on the member's estate.
(4)
A member may elect in writing to have the member's monthly retirement allowance
suspended in the month in which the member's remuneration exceeds the amount of
remuneration permitted under this subrule in lieu of receiving a reduced
retirement allowance under subparagraph (1). In order to become effective, the
member's written election must be delivered to IPERS in person, by regular
mail, email, facsimile or by private carrier. Oral elections shall not be
accepted. The member's election to suspend benefit payments in the month when
the member's remuneration exceeds the amount of reimbursement permitted under
this subrule shall remain in effect for all subsequent calendar years until
revoked by the member in writing. If the member's written election is not
received in time to avoid overpayment, the overpayment must be recovered, to
the extent possible, from monthly amounts beginning in January of the next
calendar year or under one of the alternate arrangements permitted under this
rule. Effective July 1, 2007, remuneration shall include those amounts as
described in 495-subrule 6.3(13).
(3) A member who is reemployed in covered
employment after retirement may, after again retiring from employment, request
a recomputation of benefits. The member's retirement benefit shall be
increased, if possible, by the addition of a second annuity, which is based on
years of reemployment service, reemployment covered wages and the benefit
formula in place at the time of the recomputation.
A maximum of 30 years of service is creditable to an individual
retired member. If a member's combined years of service exceed 30, a member's
initial annuity may be reduced by a fraction of the years in excess of 30,
divided by 30. The second retirement benefit will be treated as a separate
annuity by IPERS.
Effective July 1, 1998, a member who is reemployed in covered
employment after retirement may, after again terminating employment for at
least 30 days, elect to receive a refund of the employee and employer
contributions made during the period of reemployment in lieu of a second
annuity. If a member requests a refund in lieu of a second annuity, the related
service credit shall be forfeited.
Effective July 1, 2007, employer contributions described in
495-subrule 6.3(13) shall constitute "remuneration" for purposes of applying
the reemployment earnings limit and determining reductions in the member's
monthly benefits but shall not be considered covered wages for IPERS benefits
calculations.
It is the member's responsibility to apply for the
recomputation or lump sum by completing and submitting the form specified by
IPERS.
(4) In recomputing a
retired member's monthly benefit, IPERS shall use the following assumptions.
a. The member cannot change the option or
beneficiary with respect to the reemployment period.
b. If the member would only qualify for a
money purchase benefit under rule
495-12.4 (97B) based solely on
the period of reemployment, then the money purchase formula shall be used to
compute the additional benefit amount due to the reemployment.
c. If the member would qualify for a
non-money purchase retirement allowance based solely on the period of
reemployment, the benefit formula in effect as of the first month of
entitlement (FME) for the reemployment period shall be used. If the FME is July
1998 or later, and the member has more than 30 years of service, including both
original and reemployment service, the percentage multiplier for the
reemployment period only will be at the applicable percentage (up to 65
percent) for the total years of service.
d. If a period of reemployment would increase
the monthly benefit a member is entitled to receive, the member may elect
between the increase and a refund of the employee and employer contributions
without regard to reemployment FME.
e. If a member previously elected IPERS
Option 1, is eligible for an increase in the Option 1 monthly benefits, and
elects to receive the increase in the member's monthly benefits, the member's
Option 1 death benefit shall also be increased if the investment is at least
$1,000. The amount of the increase shall be at least the same percentage of the
maximum death benefit permitted with respect to the reemployment as the
percentage of the maximum death benefit elected at the member's original
retirement. In determining the increase in Option 1 death benefits, IPERS shall
round up to the nearest $1,000. For example, if a member's investment for a
period of reemployment is $1,900 and the member elected at the member's
original retirement to receive 50 percent of the Option 1 maximum death
benefit, the death benefit attributable to the reemployment shall be $1,000 (50
percent times $1,900, rounded up to the nearest $1,000). Notwithstanding the
foregoing, if the member's investment for the period of reemployment is less
than $1,000, the benefit formula for a member who originally elected new IPERS
Option 1 shall be calculated under IPERS Option 3.
f. A retired reemployed member who requests a
return of the employee and employer contributions made during a period of
reemployment cannot repay the distribution and have the service credit for the
period of reemployment restored.
g.
If a retired reemployed member selected IPERS Option 5 at retirement, and after
the period of reemployment requests an increase in the member's monthly
allowance, at death all remaining guaranteed payments with respect to both
periods of employment shall be paid in a commuted lump sum.
h. If a retired reemployed member selected
IPERS Option 2 at retirement, and after the period of reemployment requests an
increase in the member's monthly allowance, at death the member's monthly
payments following the increase shall be prorated between the member's two
annuities to determine the amount of the member's remaining accumulated
contributions that may be paid as a death benefit.
i. A retired reemployed member who has
attained the age of 70 may take an actuarial equivalent (AE) payment. However,
such a member must terminate covered employment for at least 30 days before
taking an additional AE payment.
(5) Mandatory distribution of active wages.
If a retired reemployed member whose annual benefit would be increased by less
than $600 does not request a second annuity or a lump sum payment of
reemployment accruals by the end of the fourth quarter after the last quarter
in which the member had covered wages, IPERS shall proceed to pay the member
the applicable lump sum amount. The member shall have 60 days after the
postmark date of the mandatory payment to return the payment and request a
benefit increase.
