Connecticut State Employees Retirement System Tier I The Retirement Process

Office of the State Comptroller
Retirement Services Division

Tier I - Retirement Basics
Introduction Plan Membership Eligibility Requirements Benefit Calculation Survivor Benefits Insurance: Health, Dental, and Life The Retirement Process Sources of Information Printer Friendly Version Tier 1 Estimator	The Retirement Process
Notification to Agency Required Forms Audit Process Pension Checks Agency Payouts Re-Employment 5-142(a) Disability Compensation Counseling Services Other Resources Notification to Agency Your agency is responsible for completing your retirement paperwork and submitting these forms to the Retirement Services Division for processing. Generally, we suggest that you notify your agency in writing 60 to 90 days prior to your anticipated date of retirement. You should send copies to: Your human resources office, Your payroll office, and Your supervisor or director. Your effective retirement date can only be the first of a month. Your completed retirement application must be received in the Retirement Division no later than the close of business on the last business day prior to your Date of Retirement. Required Forms Forms Your Agency Will Provide: Your agency will provide most of the required retirement forms. These forms include: your retirement application, an income payment election form, a health and dental enrollment form, a spouse waiver form, state and federal tax forms, and a direct deposit form. The following forms are available on-line at: http://osc.ct.gov/rbsd/forms.html CO-898 - Application For Retirement Benefits CO-899 - Income Payment Election Form - Option A - 50% Spouse CO-900 - Income Payment Election Form - Option B - 50% Or 100% Survivor CO-901 - Income Payment Election Form - Option C - 10 To 20 Years Period Certain CO-902 - Income Payment Election Form - Option D - Straight Life Annuity CO-1047 - Spouse Waiver Of Monthly Survivor Benefits Forms You Will Need to Provide: You will need to provide a copy of your birth certificate. If you choose a survivor option which provides a lifetime benefit to a contingent annuitant, you will need to provide a copy of your contingent annuitant's birth certificate. If you are married, you will need to provide a copy of your marriage certificate or license. If you or any of your eligible dependents are currently on Medicare, you will need to provide copies of your Medicare membership cards. Audit Process Retirement Division auditors will perform a preliminary audit of your entire retirement record and establish your preliminary benefit. You will receive your first retirement check at the end of the month in which you retire and at the end of each month thereafter. The audit process to determine your exact retirement benefit takes some time; therefore, you will be paid at an estimated level until the audit is completed. When your exact retirement benefit has been computed and verified, your income will be adjusted for the difference between your preliminary benefit and your permanent benefit update amount retroactive to your retirement date. If it takes more than 6 months to calculate your permanent benefit update, the Retirement Services Division will pay you 5% interest on any amount owed to you beyond the initial 6-month processing window. Pension Checks Retirement checks are paid monthly at the end of the month. Your pension is taxable income. All retirees are subject to federal taxes. Whether you pay state tax may depend on the state you live in as a retiree. If you reside in Connecticut you must complete the CT W4P form or your tax rate will default to the maximum default rate (which was 6.99% in 2018). For more information regarding any obligation to pay Connecticut state taxes please contact the Department of Revenue services. http://www.ct.gov/drs/site/default.asp Many deductions you pay as an active employee will end in retirement: you will no longer pay Social Security or Medicare taxes; your retirement contributions will end; and union dues are no longer mandatory in retirement. Most retirees will be required to pay only federal tax, state tax, and monthly dental premiums. You may pay for health insurance if you select a health insurance plan which requires a monthly premium or if you have less than the 25 years of actual state service. There are a select few "optional" deductions, which can be taken directly from your retirement check including the following examples: Some Credit Union Deposits Campaign for Charitable Giving Retiree Union Agency Payouts When you retire you may be entitled to certain payouts. The following payments will be paid by your agency not by the retirement division: When you retire, your active pay will finally "catch up" to you. In the first month of retirement, most retirees will receive one last full active paycheck and one partial paycheck representing any days worked into the last pay period. If you are still paid longevity, you will also receive a final pro-rated longevity check representing the number of months you have worked into the next longevity cycle. If you have vacation or sick time remaining on the books when you retire, your agency will pay you (at your terminating rate of pay): the value of your entire vacation balance, and 25% of your sick leave balance, up to a maximum of 60 days Re-Employment Once you retire from state service, provided you do not go out under a state disability retirement, the state has no limitations on your outside employment. So long as you do not return to a state payroll, you can work as much as you want and earn as much as you want without impairing your Connecticut state pension. In certain special circumstances, you may return to active state employment while retaining your full state pension. If you are able to secure a state position in the future, you may return to state service so long as you return to a temporary position and you work no more than the equivalent of 120 working days per calendar year. You may also return to state service with no restrictions by rescinding your initial retirement. (This assumes that you have independently secured a state position.) If you return to state service in a permanent position, your retirement benefits must cease, and after 6 months of re-employment you will return to Tier I and build credit towards a future retirement above and beyond what you had accrued prior to your initial retirement. 5-142(a) Disability Compensation On occasion, a retiree may begin to receive disability compensation payments under CGS Section 5-142(a) as a result of an old work related injury. State statutes specifically prohibit the receipt of disability payments under CGS Section 5-142(a) while receiving a state pension. Pension payments must stop while a retiree receives this type of disability payment. If you should become eligible to receive disability payments under CGS Section 5-142(a) after your state pension has begun, call the Retirement Services Division immediately so that you can avoid any overpayment of benefits. Sources of Information Counseling Services: The Office of the State Comptroller provides group counseling services for prospective SERS retirees. We suggest that counseling appointments should be made a minimum of 12 -15 months prior to your anticipated date of retirement. Generally, appointments are reserved for members who are planning to retire within the next 1-year period. Attending a counseling session is not required by everyone. The Counseling Unit can also answer most general retirement questions by phone. If you have additional retirement questions or would like to arrange for group counseling, feel free to contact the Counseling Unit at (860) 702-3490. Other Resources: Summary Plan Descriptions Summary Plan Descriptions/Tier Booklets provide more detailed plan information and are available online Tier I: http://osc.ct.gov/empret/tier1summ Tier 1 Benefit Calculator (link to Tier1 benefit calculator) Retiree Health Insurance Planner Health Care Options for Retirees (PDF) Social Security Administration The Social Security Administration provides Personal Earnings and Benefit Estimate Statements annually and also upon request. You may request a statement by (1-800-772-1213) or online www.ssa.gov Internal Revenue Service Retirement Information http://www.irs.gov/retirement/index.html?navmenu=menu1 Connecticut Department of Revenue Service For information regarding your obligation to pay state taxes on your state pension please contact the Connecticut Department of Revenue Services by phone (860) 297-5962 or online http://www.ct.gov/drs/site/default.asp Prudential Retirement-Deferred Compensation If you participate in the State's Deferred Compensation Plan, please direct your questions regarding your account to Prudential Retirement directly. Prudential Retirement account representatives are available by phone at (844) 505-7283 or online www.CTdcp.com.

Tier I - Retirement Basics

Introduction

Plan Membership

Eligibility Requirements

Benefit Calculation

Survivor Benefits

Insurance: Health, Dental, and Life

The Retirement Process

Sources of Information

Printer Friendly Version

Tier 1 Estimator

The Retirement Process

Notification to Agency
Required Forms
Audit Process
Pension Checks
Agency Payouts
Re-Employment
5-142(a) Disability Compensation
Counseling Services
Other Resources

Notification to Agency

Your agency is responsible for completing your retirement paperwork and submitting these forms to the Retirement Services Division for processing.
Generally, we suggest that you notify your agency in writing 60 to 90 days prior to your anticipated date of retirement. You should send copies to:
- Your human resources office,
- Your payroll office, and
- Your supervisor or director.
Your effective retirement date can only be the first of a month.
Your completed retirement application must be received in the Retirement Division no later than the close of business on the last business day prior to your Date of Retirement.

Required Forms

Forms Your Agency Will Provide:
- Your agency will provide most of the required retirement forms. These forms include: your retirement application, an income payment election form, a health and dental enrollment form, a spouse waiver form, state and federal tax forms, and a direct deposit form.
- The following forms are available on-line at: http://osc.ct.gov/rbsd/forms.html
  - CO-898 - Application For Retirement Benefits
  - CO-899 - Income Payment Election Form - Option A - 50% Spouse
  - CO-900 - Income Payment Election Form - Option B - 50% Or 100% Survivor
  - CO-901 - Income Payment Election Form - Option C - 10 To 20 Years Period Certain
  - CO-902 - Income Payment Election Form - Option D - Straight Life Annuity
  - CO-1047 - Spouse Waiver Of Monthly Survivor Benefits
Forms You Will Need to Provide:
- You will need to provide a copy of your birth certificate.
  - If you choose a survivor option which provides a lifetime benefit to a contingent annuitant, you will need to provide a copy of your contingent annuitant's birth certificate.
  - If you are married, you will need to provide a copy of your marriage certificate or license.
- If you or any of your eligible dependents are currently on Medicare, you will need to provide copies of your Medicare membership cards.

Audit Process

Retirement Division auditors will perform a preliminary audit of your entire retirement record and establish your preliminary benefit. You will receive your first retirement check at the end of the month in which you retire and at the end of each month thereafter.
The audit process to determine your exact retirement benefit takes some time; therefore, you will be paid at an estimated level until the audit is completed. When your exact retirement benefit has been computed and verified, your income will be adjusted for the difference between your preliminary benefit and your permanent benefit update amount retroactive to your retirement date.
If it takes more than 6 months to calculate your permanent benefit update, the Retirement Services Division will pay you 5% interest on any amount owed to you beyond the initial 6-month processing window.

Pension Checks

Retirement checks are paid monthly at the end of the month.
Your pension is taxable income. All retirees are subject to federal taxes. Whether you pay state tax may depend on the state you live in as a retiree. If you reside in Connecticut you must complete the CT W4P form or your tax rate will default to the maximum default rate (which was 6.99% in 2018). For more information regarding any obligation to pay Connecticut state taxes please contact the Department of Revenue services.
http://www.ct.gov/drs/site/default.asp
Many deductions you pay as an active employee will end in retirement:
- you will no longer pay Social Security or Medicare taxes;
- your retirement contributions will end; and
- union dues are no longer mandatory in retirement.
Most retirees will be required to pay only federal tax, state tax, and monthly dental premiums. You may pay for health insurance if you select a health insurance plan which requires a monthly premium or if you have less than the 25 years of actual state service.
- There are a select few "optional" deductions, which can be taken directly from your retirement check including the following examples:
  - Some Credit Union Deposits
  - Campaign for Charitable Giving
  - Retiree Union

Agency Payouts

When you retire you may be entitled to certain payouts. The following payments will be paid by your agency not by the retirement division:
- When you retire, your active pay will finally "catch up" to you. In the first month of retirement, most retirees will receive one last full active paycheck and one partial paycheck representing any days worked into the last pay period.
- If you are still paid longevity, you will also receive a final pro-rated longevity check representing the number of months you have worked into the next longevity cycle.
- If you have vacation or sick time remaining on the books when you retire, your agency will pay you (at your terminating rate of pay):
  - the value of your entire vacation balance, and
  - 25% of your sick leave balance, up to a maximum of 60 days

Re-Employment

Once you retire from state service, provided you do not go out under a state disability retirement, the state has no limitations on your outside employment. So long as you do not return to a state payroll, you can work as much as you want and earn as much as you want without impairing your Connecticut state pension.
In certain special circumstances, you may return to active state employment while retaining your full state pension. If you are able to secure a state position in the future, you may return to state service so long as you return to a temporary position and you work no more than the equivalent of 120 working days per calendar year.
You may also return to state service with no restrictions by rescinding your initial retirement. (This assumes that you have independently secured a state position.) If you return to state service in a permanent position, your retirement benefits must cease, and after 6 months of re-employment you will return to Tier I and build credit towards a future retirement above and beyond what you had accrued prior to your initial retirement.

5-142(a) Disability Compensation

On occasion, a retiree may begin to receive disability compensation payments under CGS Section 5-142(a) as a result of an old work related injury. State statutes specifically prohibit the receipt of disability payments under CGS Section 5-142(a) while receiving a state pension. Pension payments must stop while a retiree receives this type of disability payment.
If you should become eligible to receive disability payments under CGS Section 5-142(a) after your state pension has begun, call the Retirement Services Division immediately so that you can avoid any overpayment of benefits.

Sources of Information

Counseling Services:

The Office of the State Comptroller provides group counseling services for prospective SERS retirees. We suggest that counseling appointments should be made a minimum of 12 -15 months prior to your anticipated date of retirement. Generally, appointments are reserved for members who are planning to retire within the next 1-year period.
Attending a counseling session is not required by everyone. The Counseling Unit can also answer most general retirement questions by phone. If you have additional retirement questions or would like to arrange for group counseling, feel free to contact the Counseling Unit at (860) 702-3490.

Other Resources:

Summary Plan Descriptions
- Summary Plan Descriptions/Tier Booklets provide more detailed plan information and are available online
  - Tier I: http://osc.ct.gov/empret/tier1summ
Tier 1 Benefit Calculator
- (link to Tier1 benefit calculator)
Retiree Health Insurance Planner
- Health Care Options for Retirees (PDF)
Social Security Administration
- The Social Security Administration provides Personal Earnings and Benefit Estimate Statements annually and also upon request. You may request a statement by (1-800-772-1213) or online www.ssa.gov
Internal Revenue Service Retirement Information
- http://www.irs.gov/retirement/index.html?navmenu=menu1
Connecticut Department of Revenue Service
- For information regarding your obligation to pay state taxes on your state pension please contact the Connecticut Department of Revenue Services by phone (860) 297-5962 or online http://www.ct.gov/drs/site/default.asp
Prudential Retirement-Deferred Compensation
- If you participate in the State's Deferred Compensation Plan, please direct your questions regarding your account to Prudential Retirement directly. Prudential Retirement account representatives are available by phone at (844) 505-7283 or online www.CTdcp.com.

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