Mississippi Administrative Code
Title 27 - Personnel
Part 210 - PERS, Regulations for Retirement Plans Administered by the Board of Trustees
Chapter 64 - Purchase of Service Credit in the Public Employees' Retirement System at Actuarial Cost
Section 27-210-64-108 - Funds used to purchase service
Current through September 24, 2024
Service credit at actuarial cost can be purchased using after-tax funds received directly from the member. Alternatively, such credit may be purchased using tax-deferred (pre-tax) money from certain retirement plans as allowed by the Internal Revenue Code (IRC).
1. Direct payment of funds by the member
PERS will accept funds remitted directly by the member for purchase of service at actuarial cost. These payments are not tax-deductible at the time of the purchase, but are considered after-tax contributions. These funds will be used in the calculation of the tax exclusion applied to the benefit at retirement. Treatment of the funds as after-tax contributions applies even if the source of the funds is from a retirement plan from which the member could have made a direct rollover or transfer of the funds.
2. Direct transfer or rollover of funds to purchase service
PERS will accept qualifying tax-deferred direct trustee-to-trustee transfers or rollovers from the trustee/custodian of a 401(a) or 401(k) qualified plan, IRC Section 457 deferred compensation plan, qualified 403(a) annuity, IRC Section 403(b) annuity, or distributions from an Individual Retirement Account (IRA) for the purchase of service. These funds will be treated as tax-deferred funds and will be taxed when distributed to the member.
