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May 11, 2021, 8:13 AM By MOSERSSome of our employees are working a second job direct care appointment with our facility in addition to their regular direct care appointment. As this is different from earning overtime that becomes comp time, their earnings are shown on their normal payroll as income earned. How will this benefit our employees working these second job appointments on their Final Average Pay (FAP) to calculate their pension benefits?
Pension benefits are calculated using a formula, which is: Final Average Pay (FAP) x a Multiplier* x Credited Service = Monthly Base Benefit
The additional earnings for working in a second job may increase their final average pay. Statutorily required employer and employee contributions must be paid to the System on any such compensation. See MOSERS Board Rule 2-8 for details.
However, state law says an employee can earn only one day of service credit for each day worked so it would not increase their credited service in terms of retirement eligibility or for calculating their benefit amount.
Below is a simplified example showing how working in an additional position could potentially impact an employee’s benefit. Employees should contact a MOSERS benefit counselor to get an estimate for their particular situation:
Working in one full-time position making $28,307 per year and retiring in MSEP 2000 with 25 years of service:
$28,307/12 months = $2,358.92 as monthly final average pay
FAP ($2,358.92) x Multiplier (0.017) x Credited Service (25) = $1,002.54 monthly base benefit in retirement
Working in one full-time position making $28,307 per year and retiring in MSEP 2000 with 25 years of service plus working in a part-time position at the same rate of pay (an extra 1,000 hours at $13.61 per hour per = $13,610 per year for 3 years):
$41,917/12 months = $3,493.08 as monthly final average pay
FAP ($3,493.08) x Multiplier (0.017) x Credited Service (25) = $1,484.56 monthly base benefit in retirement
*The multiplier for MSEP is 1.6%; the multiplier for MSEP 2000 and MSEP 2011 is 1.7%.
May 11, 2021, 8:13 AM By MOSERSif needed could I pull funds out for down payment assistance?
You are not able to access your MOSERS defined benefit pension until retirement. However, if you no longer work in a MOSERS benefit-eligible position, and you are a member of MSEP 2011, you may be eligible to request a refund of your employee contributions. By taking a refund, you will lose all your credited service and future rights to receive pension and LTD benefits from MOSERS. By law, there is a 90-day waiting period before we can issue a refund.
The MO Deferred Comp 457 retirement savings plan permits in-service withdrawals from your account under the following circumstances; you experience a qualifying, unforeseeable emergency that causes extreme financial hardship, or if your account balance is $5,000 or less – you may elect a one-time, in-service distribution, provided you have not made a contribution during the prior two-year period. Please visit www.modeferredcomp.org for more information or if you have any questions please call (800) 392-0925.
May 4, 2021, 8:19 AM By MOSERSI am attempting to delete one of my beneficiaries for my life insurance. It appears that the online form only allows you to add a beneficiary. Perhaps I am just not understanding the form. Please advise how I need to proceed. Thank you in advance
We are working on a new system that will allow you to make a simple update without re-entering all information for your beneficiaries, but right now, with our current system, you must start over and re-enter all information about your beneficiaries if you want to update one of them.
To update your beneficiary designations, you must first log in to myMOSERS. Complete and submit the Designation/Change of Beneficiaries form (“Life Ins Beneficiaries” from the Forms drop-down menu) for basic and optional life insurance. This form also applies to deleting a beneficiary. You will need to enter the information of your new beneficiaries and submit the form. If you are a member of the MSEP 2011 or the Judicial Plan 2011, you should also complete and submit the Contribution Beneficiaries form for your employee contributions.
Visit our Life Events page for more information.
Apr 28, 2021, 4:08 PM By MOSERSI am planning to retire in 2024 and at that time, I would receive my full backdrop. I need a better understanding of the "backdrop". After retiring, can I draw from my back drop as needed or is there a set amount of money that I will get monthly?
With BackDROP, you will get a lump-sum payment at retirement in addition to your monthly pension payments from MOSERS. Choosing BackDROP will, most likely, reduce the amount of your ongoing monthly benefit payments. We will provide you with Benefit Estimates at the time of retirement to show your BackDROP options and the impact of taking BackDROP on your monthly benefit payments. You can get estimates at any time by logging in to myMOSERS or by contacting a MOSERS benefit counselor.
At retirement, we will ask you if you want to elect BackDROP or not and, if so, how you want to take your BackDROP lump-sum payment. Your choices are to take it as a cash payment, as a direct rollover to an individual retirement account or eligible employer plan such as MO Deferred Comp, or as a combination of cash and rollover
Along with your first monthly pension benefit payment, we will issue your BackDROP payment (as either cash, rollover, or a combination) on the last working day of the month in which you retire.
Your question about how much you can draw from your BackDROP is really about taxes and possible IRS penalties.
- Cash Option: This is either one lump-sum payment at retirement or three annual installments. From any amounts paid in cash, we will deduct 20% for federal income tax (as required by the IRS) and any Missouri state income tax withholding you choose. You will be responsible for any IRS early withdrawal penalties that may apply.
- Rollover Option: We will send your tax-deferred distribution directly to a qualified employer plan. See the MO Deferred Comp flyer, Thinking About the BackDROP?, for more information.
- Combination Cash & Rollover Option: You can take a portion of the lump sum in cash (less 20% for federal income tax, as required by the IRS, and any Missouri state income tax you choose to have withheld) and roll the rest over to a qualified employer plan. You will be responsible for any IRS early withdrawal penalties that may apply.
Visit the BackDROP page on our website for additional information.
Note: BackDROP is available only to general state employees in MSEP and MSEP 2000 who work at least two years beyond normal retirement eligibility.
Apr 27, 2021, 1:37 PM By MOSERSIs overtime included when figuring for an employee's retirement, or is their regular salary for the highest 36 consecutive months used in the calculation?
Yes, overtime can increase a member’s pension benefits.
Retirement benefits for general state employees are calculated using a three-part formula: Final Average Pay (FAP) x credited service x a multiplier = Monthly Base Benefit
To calculate your pension benefit, we will use your highest 36 full consecutive months of pay – wherever that occurs in your individual pay history.
In identifying your “high 36” months, overtime pay is included in the pay period for which it was earned.
The multiplier for general state employees in MSEP is 1.6%; it is 1.7% for general state employees in MSEP 2000 and MSEP 2011.
Apr 19, 2021, 8:27 AM By MOSERSI receive pension but i live in Michigan. How do i file taxes if any?
You will need your 1099-R form from MOSERS to file your federal income tax return. You may have already received yours in the mail back in early February. If you prefer an electronic copy of your 1099-R or if you find you need a replacement copy of it, simply log in to myMOSERS and you will find it listed under Personal Information. It is available to print.
If you lived in Missouri at any point during the tax year, you may owe Missouri state taxes, but you may also qualify for the Missouri State Public Pension Exemption. Contact the Missouri Department of Revenue and state tax agency in Michigan for additional information about and to inquire if you will need to file a state tax return in either or both states.
Mar 25, 2021, 10:12 AM By MOSERSIs MOSER retirement considered a public pension for tax purposes?
Yes, that is correct. The benefit you receive through MOSERS is considered a public pension for tax reporting purposes. If you are a Missouri resident, you may qualify for the Public Pension Exemption. Visit the Missouri Department of Revenue's Public Pension Exemption page or read our Missouri Public Pension Exemption flyer for more information. Additionally, you can visit the Taxes page on our website.
Mar 22, 2021, 12:03 PM By MOSERSIn reading your newsletter today regarding the different requirements to retire, for the MSEP 2000, wasn't there an early retirement option at age 57 with 5 years of service also?
Yes, there is an early retirement option for members who are members of the MSEP 2000. What we referenced in the previous Rumor Central post was just normal retirement eligibility, not early retirement eligibility. You can find more information on our MSEP 2000 web page.
Mar 4, 2021, 3:26 PM By MOSERSBoth my daughters are now married. They are two of my beneficiaries. How do I change just their last names?
To update your beneficiary designations, log in to myMOSERS. Complete and submit the Designation/Change of Beneficiaries form (“Life Ins Beneficiaries” from the Forms drop-down menu) for basic and optional life insurance. If you are a member of the MSEP 2011 or the Judicial Plan 2011, you should also complete and submit the Contribution Beneficiaries form for your employee contributions.
If you cannot log in to submit the forms online, contact a MOSERS benefit counselor at firstname.lastname@example.org, (800) 827-1063 or (573) 632-6100 to request paper forms, which we will mail to your home address.
If you participate in the state’s deferred compensation program, you may want to update your beneficiaries with MO Deferred Comp, as well.
Feb 24, 2021, 8:50 AM By MOSERSI heard that all state employees under the 2011 are being moved to an 80 and out model. Is that true?
We are unaware of any legislative proposals related to changing MSEP 2011 normal retirement eligibility from “90 and out” to “80 and out”. Members of MSEP 2011 reach normal retirement eligibility when they have at least 5 years of service and are age 67 OR under the “Rule of 90”. Under the “Rule of 90”, they must be at least age 55 and their age plus years of service must equal 90 or more at the time of termination of employment. For example, if someone leaves employment at age 60 and has 30 years of service, they would meet the Rule of 90.
NORMAL RETIREMENT ELIGIBILITY REQUIREMENTS:
- Age 65 + 5 years of service or
- Age 60 + 15 years of service or
- “Rule of 80” – (at least age 48) when age + years of service = 80 or more
- Age 62 + 5 years of service or
- “Rule of 80” – (at least age 48) when age + years of service = 80 or more at time of termination.
- Age 67 + 5 years of service or
- “Rule of 90” – (at least age 55) when age + years of service = 90 or more at time of termination
Not sure if you are in MSEP, MSEP 2000, or MSEP 2011? See What’s My Plan? with information about plan membership, retirement eligibility requirements, and other plan provisions.
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We strive to provide the most accurate information possible in our answers to Rumor Central questions. However, occasionally, laws, policies or provisions change and individual circumstances may vary. Please contact a MOSERS benefit counselor or see the handbooks in our website Library for more detailed information. If there is any difference between the information provided in this blog or on the MOSERS website and the law or policies that govern MOSERS, the law and policies will prevail. See our Privacy, Security & Legal Notices for more information.