Retired Members

    • Beneficiary Designations

      Can I change my beneficiary designations after retirement?

      The answer depends on which retirement option you elected. For certain options, the age of the member's beneficiary is a factor in calculating a retirement allowance; as a result, the beneficiary cannot be changed after the retirement date has passed. However, for the following options, you can change your beneficiary(ies) after retirement:

      • For Tier I and II members—Options I, IV-b, IV-d, and IV-e; and
      • For Tier III, IV, and VI members—Options 3 and 4.

      After retirement, you may also change your fractional beneficiary and your Death Benefit #2 beneficiary, if applicable.

      Why do I need to provide TRS with my beneficiary's Social Security number?

      Having your beneficiary's Social Security number^ on file with TRS prevents unnecessary delay and complications at the time death benefits become payable.

      TRS cannot distribute death benefits from a member's account until we have identified and contacted all designated beneficiaries on file. And, while other demographic information may be incomplete in our records or become outdated over time, the Social Security number is the most reliable way of confirming the identity of your beneficiaries and initiating contact with them.

      This is why TRS requires members who make beneficiary designations on our website to enter each beneficiary's Social Security number. If you do not enter the number, you won't be able to designate beneficiaries online and will have to file a paper form instead.

      TRS will accept paper beneficiary designation forms that do not include the beneficiary's Social Security number. However, if you file such forms, we will continue to alert you about the missing information on account statements and other correspondence where we list your beneficiaries.

      ^If your beneficiary does not have a Social Security number, then an alternative number such as the Individual Tax Identification Number (ITIN) may be used instead. If your beneficiary is a charity or organization, the Employer Identification Number (EIN) may be used.

    • Death Benefits

      What is Death Benefit #1?

      Under Death Benefit #1, the benefit would equal 1/12 of the member's last 12 months' regularly earned salary multiplied by each full year of Total Service Credit—to a maximum of three times the member's annual salary; this maximum would apply to members who have 36 or more years of Total Service Credit. (This description assumes that the member was in active service and died with at least one year of Total Service Credit since last joining TRS.)

      As of October 1, 2000, beneficiaries of Tier II, III, and IV members receive the greater of either Death Benefit #1 or Death Benefit #2, even if the member had elected Death Benefit #1 coverage. Members who joined TRS after January 1, 2001 (including Tier VI members) are automatically enrolled in Death Benefit #2.

      What is Death Benefit #2?

      Under Death Benefit #2, the benefit would equal one year's salary upon the completion of one year of service, two years' salary upon the completion of two years of service, and three years' salary upon the completion of three or more years of service. If the member remained in service to age 61, the in-service death benefit would be reduced by 5% for each succeeding year until age 70, when the benefit would equal 50% of the applicable amount. This description assumes that the member was in active service and died with at least one year of Total Service Credit since last joining TRS.)

      As of October 1, 2000, beneficiaries of Tier II, III, and IV members receive the greater of either Death Benefit #1 or Death Benefit #2, even if the member had elected Death Benefit #1 coverage. Members who joined TRS after January 1, 2001 (including Tier VI members) are automatically enrolled in Death Benefit #2.

      The following table shows the age-reduction factors that affect the benefit payable under Death Benefit #2.

      Age at Date of Death Percentage of Benefit Payable After Reduction
      60 or under 100%
      61 95%
      62 90%
      63 85%
      64 80%
      65 75%
      66 70%
      67 65%
      68 60%
      69 55%
      70 50%

      What should I do if I want to leave my death benefit to my estate or to a trust?

      In order to designate your estate as a beneficiary, simply write "estate" in the name section of your beneficiary form. If you would like to designate a trust, you must indicate this on the beneficiary form, attach a copy of the will or trust, and file TRS' Verification of Trust Instrument Legality form (code EN4) with your beneficiary designations. You may order this form through the "Tools" section on our website, or by calling TRS at 1 (888) 8-NYC-TRS.

      When a retiree dies, what benefits may be payable?

      A death benefit, representing all or part of the member's retirement allowance under the Qualified Pension Plan (QPP), may be payable to a designated beneficiary or the member's estate; this would be based upon the payment option that the member chose at retirement. In addition, a fractional payment of the retirement allowance payment for the month in which the member died would be payable to a designated beneficiary, as long as the member did not die on the last day of the month.

      Why are beneficiaries required to return any retirement allowance checks the retiree received in or after the month of death?

      When a retiree dies before the last day of a month, that month's check is no longer payable to the member. A fraction of the payment, representing the portion of the month the member was alive, is payable to a fractional beneficiary, whom the member designated on his/her retirement application. The remaining portion of the payment is payable as part of the regular death benefit.

      If any retirement allowance payments were cashed or directly deposited after the member's death, TRS will contact his/her beneficiaries to inform them of the total amount due. TRS must receive payment in order to process any benefits payable.

      How is interest calculated on death benefit payments?

      Where interest applies, the interest rate used for death benefit payments is the lesser of the following: a) the actual net rate of return on TRS' Qualified Pension Plan (QPP) assets for a corresponding period, based on reported quarterly investment returns; or b) the scheduled rate of 5% simple interest for the first year following the member's death, 4% for the second year, 3% for the third year, 2% for the fourth year, 1% for the fifth year, and no interest for the sixth year following the member's death and thereafter. If the applicable net rate of investment return on TRS' QPP assets is zero or negative, no interest would be applied to the death benefit payment; however, the benefit itself would not be reduced.

      Please note that TRS determines the interest amount only after the benefit is claimed; we cannot determine the interest amount in advance because actual investment returns are a factor in the calculation.

      When does interest on death benefit payments begin?

      That depends on what type of benefit you are receiving:

      For a lump-sum death benefit —Interest begins as of the 31st day after the date of death and continues until the earliest of the following dates: a) the date the benefit payment is issued; or b) five years after the date of death; or c) six months after the date that TRS sends claim forms and/or notification of this policy by letter to the beneficiaries.

      For death benefit payments under a continuing payment option —The benefit payable to the beneficiary is monthly payments for life equaling a percentage of the member's retirement allowance. In this case, interest begins from the date of death of the member and continues until the earlier of the following dates: a) one calendar month prior to the date the initial payment is paid; or b) six months after the date that TRS sends claim forms and/or initial notification of this policy by letter to the beneficiary.

    • Employment

      What does a Section 212 Waiver cover?

      Filing a Section 212 Waiver (Certification of Employment Under Section 212) (code RP76) allows service retirees under age 65 to return to public employment with New York State or any of its political subdivisions and earn up to a designated limit each calendar year without jeopardizing their retirement allowance. The current earnings limit is $30,000. (This limit will remain the same unless the New York State Legislature changes it.) For more information, please see the Earnings After Retirement brochure.

      What does a Section 211 Waiver cover?

      If service retirees under age 65 anticipate that they will exceed the maximum earnings allowed under a Section 212 Waiver, they must file a Section 211 Waiver with their employer (not TRS) to continue receiving a retirement allowance subject to certain restrictions. Retirees are encouraged to contact TRS to request an estimate of their earnings limit prior to filing a Section 211 Waiver with their employer.

      For more information, please see the Earnings After Retirement brochure.

      What is the maximum that I can earn after retirement?

      That amount differs under certain situations. For example:

      There is no limit if you are at least age 65 or if you are working in any job other than public employment with New York State or its political subdivisions.

      If you are a service or a disability retiree working in public employment in New York State, the total of the pension portion of your retirement allowance plus your post-retirement earnings must be less than $1,800 annually.

      Service retirees may file a Section 212 Waiver (Certification of Employment Under Section 212) (code RP76) with TRS and earn up to the designated annual limit: $30,000. (This limit will remain the same unless the New York State Legislature changes it.) By filing a Section 211 Waiver with their employer, service retirees may be able to earn more than this amount. (Note that disability retirees are not eligible to file Section 212 or 211 Waivers.) Retirees are encouraged to request an estimate of their earnings limit from TRS prior to filing a Section 211 Waiver with their employer.

      For more information, please see the Earnings After Retirement brochure.

      What happens if I exceed the earnings limitation for a retiree?

      If you exceed your earnings limit, you must repay the excess earnings to your employer or your retirement allowance would be suspended. If you are working under a Section 212 Waiver, the suspension would begin in the month that you exceed the limit, and it generally would continue for the rest of the calendar year. Under a Section 211 Waiver, the suspension would continue until the amount of your suspended retirement allowance equals your excess earnings. For more information, please see the Earnings After Retirement brochure.

      How can I be restored to active service after I retire?

      You should first find employment in a TRS-eligible position. In addition, you must file with TRS either an Application for Restoration from Service Retirement (code GA1) or an Application for Voluntary Restoration from Disability Retirement (code DI20). The Application for Voluntary Restoration from Disability Retirement may be obtained by calling TRS at 1 (888) 8-NYC-TRS and speaking with one of our Member Services Representatives.

      How long does it take to complete a restoration to active service?

      The process takes four to six months from the effective date of restoration.

      How soon after I am restored to active service can I apply for a QPP loan?

      You may apply for a new QPP loan approximately four months after you receive your new TRS membership number.

    • Legal

      What is a Power of Attorney (PoA)?

      A PoA is a legal instrument that allows one or more individuals (referred to as agents or attorneys-in-fact) to act on behalf of another person (referred to as the principal). Agents can be granted the right to handle a broad range of personal, financial, legal, and other business affairs—including retirement benefits.

      Please note the following:

      By using a PoA, you are able to decide in advance whom you want to act for you in situations in which you are unable to make decisions for yourself. However, you do not lose your authority to act even though you have given your agent similar authority.

      A durable PoA allows the agent to act for you even after you are legally incapacitated (i.e., when you lack sufficient understanding to make rational decisions or engage in responsible actions due to mental or physical disability or illness). A durable PoA may be used immediately and is effective until revoked by you, or until your death.

      If you don't have a durable PoA in place and you become incapacitated, your affairs may need to be managed by a court-appointed guardian under a process that can be complex and expensive.

      Once you appoint an agent under a PoA, that person may act on your behalf without telling you. When choosing an agent, you should select someone you trust who will act in your best interest.

      TRS strongly recommends that you consult an attorney before executing a PoA.

      How can I execute a Power of Attorney (PoA) granting an agent the authority to make decisions on my behalf regarding my TRS benefits?

      If you are a TRS member wishing to execute a PoA granting another person(s) the authority to make decisions regarding your current and future TRS retirement benefits, you may either:

      Complete and submit a TRS Special Durable Power of Attorney (code BK75) . This non-statutory form is for use by TRS members and is specifically limited to TRS retirement benefit transactions and does not authorize an agent to act in a transaction that is not related to TRS. Please note that TRS makes this form available merely as a convenience and assumes no responsibility with regard to your use of it.

      If you execute a TRS Special Durable Power of Attorney form without placing any limitations in the form's Section (g): MODIFICATIONS, you are authorizing the agent to conduct ANY transaction that you would be authorized to do (discuss retirement benefits, request access to personal information, change depository account information, etc.) with these two exceptions: 1) The agent may not name himself or herself the beneficiary of your retirement benefits, or 2) designate or change your current beneficiary.

      If you want a person to be able to name himself/herself as the beneficiary, or designate or change your current beneficiary as the holder of your PoA, you must specifically include this information in Section (g): MODIFICATIONS of the TRS Special Durable Power of Attorney form.

      OR

      Complete and submit a statutory short form PoA provided under the New York General Obligations Law. In order for an agent to have the power to make gifts and other transfers, including the authority to designate or change beneficiaries on retirement benefit plans, both a statutory short form PoA and a statutory gifts rider must be executed simultaneously and submitted to TRS. You may instead file a valid PoA document that was executed in another state, which grants your attorney-in-fact the ability to change your beneficiary designations in accordance with that state's applicable law.

      TRS strongly urges you to consult with an attorney before you execute a PoA to address any specific legal questions concerning this information. In all cases, the specific provisions of the governing laws, rules, and regulations will prevail.

      Can my Power of Attorney (PoA) agent change my beneficiary designations?

      If you execute a TRS Special Durable Power of Attorney (code BK75) form without modifying the form's default grant of authority to agents, your agent would not be able to change your current beneficiary designations. However, you can specifically provide on this form that your agent is able designate or change your current beneficiary designations, or to name himself/herself as the beneficiary.

      If you execute a statutory short-form PoA, your agent may not change your beneficiary designations or designate himself/herself as the beneficiary unless the form contains a paragraph granting gift-giving authority you initialed AND the PoA is accompanied by a valid statutory gifts rider, which was created simultaneously with the PoA. The rider must be executed pursuant to the requirements of General Obligations Law Section 5-1514, which includes it being acknowledged and witnessed by two witnesses.

      A short-form PoA, properly executed in accordance with the law in effect prior to September 1, 2009, remains valid and will be honored by TRS.

      How can I revoke my Power of Attorney (PoA)?

      You may revoke your PoA at any time by sending us a signed, notarized statement.

      Although a durable PoA is revocable before someone becomes incapacitated, if TRS is not notified when a PoA is revoked, TRS generally will be entitled to rely on its good-faith belief as to the PoA's continued validity.

      If I have Power of Attorney (PoA) for a retiree, how may I obtain a copy of the retiree's 1099 Form?

      If TRS has a copy of your PoA on file, you may submit a written request to TRS for a copy of the retiree's 1099 Form. You may also submit a written, notarized authorization from the retiree if you wish to have this information released to you.

      How did the Pension Reform Law (Chapter 504 of the Laws of 2009) affect TRS members?

      Chapter 504 had broad effects on New York State public retirement systems. Individuals who became TRS members after December 10, 2009, but before April 1, 2012, are affected as follows:

      Members who are represented by the United Federation of Teachers (UFT) become vested after they have ten years of service credit.

      Members who participate in the Age 55 Retirement Program ("55/27" participants) will make pension contributions of 4.85% of gross pensionable compensation until they have 27 years of service credit, and contributions of 1.85% of gross pensionable compensation after reaching 27 years of service credit.

      In addition, Chapter 504 affected certain members regardless of their membership date: For all participants in the Tax-Deferred Annuity (TDA) Program who are serving in (or resigned/retired from) UFT-covered titles, the annual interest rate paid by the Fixed Return Fund is 7% as of December 11, 2009.

      Note: Chapter 504 also established a new tier—Tier V—for New York State public retirement systems and the Optional Retirement Program (available to CUNY employees). This change did not apply to TRS.

      What is the Goodman Settlement?

      On March 17, 2014, a settlement between the City of New York and the United States Attorney's Office in the case of Goodman, et al. v. City of New York, et al. ("Goodman") became effective. The Goodman Settlement impacts the pension calculations of certain members and pensioners who served in the military after September 11, 2001.

    • Loans

      What is the maximum loan amount that I may borrow?

      For both QPP and TDA loans, the maximum loan amount available to you is based on factors such as your account balance, your service credit, your current outstanding loan balance, and your highest loan balance during the previous 12 months. You may learn the maximum loan amount that you may borrow by logging in to the secure section of our website. Members may also write to TRS to obtain this information at any time; if you do so, please include your membership number in your correspondence.

      Why is my maximum available loan amount less than I expected?

      Your maximum loan amount may be less than you expected because the maximum amount you may borrow is restricted by certain conditions. These conditions are explained in the QPP Loans and TDA Loans brochures.

      What are the eligibility requirements for taking a TDA loan?

      You may be eligible for a TDA loan under the following conditions: a) if you have participated in the TDA Program for at least one year; b) if you are an in-service member, or you are on a leave of absence, or you have TDA Deferral status; and c) if you are not in default on an existing TDA loan. You may learn whether you are currently eligible to take a loan by logging in to the secure section of our website.

      What is the minimum loan amount that I may borrow?

      In general, the minimum QPP loan available is $250; however, for Tier III, IV, and VI members who do not have an outstanding QPP loan, the minimum QPP loan available is $1,000. The minimum TDA loan available is $1,000 for all members, except for those with an outstanding TDA loan balance; those members may request a minimum amount of $250 as long as the amount they request plus their current outstanding TDA loan balance totals at least $1,000.

      Can I change the loan amount that I request on my application?

      Yes. However, you must submit a notarized request to do so by noon on the Friday of the week in which you filed your application.

      What interest rate charges and service charges apply to a loan?

      For Tier I and II members, the current interest rate on a QPP loan is 6%; for Tier III, IV, and VI members, it is 7%.

      For all tiers, the interest rate on a TDA loan is equal to the annual rate of return that you would receive on TDA investments in the Fixed Return Fund. Therefore, for members serving in (or retired/resigned from) a UFT-covered title, the interest rate on TDA loans would be 7%; for other members, the interest rate would be 8.25%.

      A $30 service charge is added to all TDA loans, as well as to QPP loans issued to Tier III, IV, and VI members.

      Is insurance provided on a loan?

      Yes. For all TDA loans and for QPP loans issued to Tier III, IV, and VI members, full insurance coverage begins 30 days after a loan is issued; insurance premiums are included in regular loan payment amounts. For QPP loans issued to Tier I and II members, partial insurance coverage begins 30 days after a loan is issued; this coverage gradually increases until 90 days after the loan is issued, when coverage reaches 100% of the loan balance, up to a $10,000 limit. Tier I and II members are not charged for the insurance on a QPP loan. Insurance on a loan would be terminated if you default on your loan.

      How do I apply for a loan?

      If you are a member in active service or on a leave of absence, you may apply for a loan from the QPP by logging in to the secure section of our website or by filing a paper QPP Loan Application (code LO6).

      If you are a participant in TRS' TDA Program and you are in active service, on a leave of absence, or have TDA Deferral status, you may apply for a TDA loan by logging in to the secure section of our website or by filing a paper TDA Loan Application (code LO15).

      However, if you are applying for a QPP or TDA loan in conjunction with retirement, you must file a paper loan application. For more information about loans, please refer to the QPP Loans and TDA Loans brochures.

      Why was my loan application canceled?

      Your loan application may have been canceled because you were ineligible for a loan at the time you applied. TRS will also cancel a loan application if a member's employer notifies us that a member has resigned. Please see the explanation in the letter notifying you of the cancellation.

      How often may I take a loan?

      If you are a Tier I or II member, you may be eligible to receive up to two QPP loans within a 12-month period. If you are a Tier III, IV, or VI member, you may be eligible to receive one QPP loan within a 12-month period. Eligible TDA participants may receive one TDA loan within a 12-month period.

      May I take a loan while I have an outstanding loan balance?

      If you are otherwise eligible for a loan, you may apply for a new QPP loan while you have an outstanding QPP loan balance. Through December 31, 2003, your new QPP loan amount would be added to your outstanding loan balance, resulting in a new QPP loan balance. The new loan balance would be subject to the repayment terms, interest, and insurance charges in effect when the new loan is issued. However, effective January 1, 2004, Internal Revenue Service (IRS) regulations would no longer allow outstanding loan balances to be combined with new loans. Instead, any new loan requested would be treated as a separate loan balance, and each loan balance would be subject to the interest and insurance charges in effect when the loan is issued.

      How long does it take for a loan to be issued?

      Each Wednesday, TRS mails loan checks to members' home addresses. In order for a loan check to be mailed to your home address on a given Wednesday, TRS must generally receive your loan application by the close of business on Wednesday of the preceding week. (If a holiday occurs during the week, TRS must receive your loan application by the first business day of that week.)

      What happens if a loan check never reaches my home?

      TRS will place a stop-payment on a lost loan check if you file an Affidavit for Missing Check (code BK2). In general, TRS will issue a duplicate check within 7-10 days after receiving this form.

      Can I have my loan deposited directly in a bank account?

      Members who receive their paychecks through direct deposit or monthly retirement allowance payments electronically may elect to have their loan forwarded via Electronic Fund Transfer (EFT) to the account where these payments are deposited. If members are not eligible to elect EFT, their loan check would be mailed to their home address.

      Will a TRS loan show up on external credit checks?

      No. TRS will not release your information to a third party.

      If I purchase an expensive item such as a car with my loan money, should I indicate TRS as a lienholder?

      No. TRS does not have a lien on the items you may purchase with loan proceeds.

      How can I obtain information about the current status of my loan?

      You may do so by logging in to the secure section of our website. You may also write to TRS to obtain this information at any time; if you do so, please include your membership number in your correspondence.

      How do I repay a loan?

      Retirees who take TDA loans have a choice of how they want to repay the loans: automatic deductions from their monthly retirement allowance or monthly direct payments to TRS. To change your repayment method for any outstanding TDA loan, you may file a Request to Change TDA Loan Repayment Method (code LO105). You may also request to repay your outstanding loan in a lump sum by filing a TDA Loan Repayment Request Form (code LO11t) with TRS.

      How many months do I have to repay a loan?

      Tier I and II members must repay QPP loans within four years. All TDA loans, and QPP loans for Tier III, IV, and VI members, must be repaid within five years.

      What does the number of loan payments mean in terms of months?

      The number of payment periods for a loan is generally two per month. For example, 96 payments means 48 months.

      May I change the amount that I am currently repaying toward my loan?

      If you are an in-service Tier III, IV, or VI member, you may submit a partial lump-sum payment on a QPP and/or TDA loan and thus reduce the amount of your regular loan payments. This payment would be made in addition to your regularly scheduled periodic payments.

      To make a partial lump-sum payment, please submit a check payable to the "Teachers' Retirement System of the City of New York" with a written request to have your repayment period changed (if it would not exceed 60 months) and/or to change the amount of your regularly scheduled payments. Once TRS receives your payment and written request, your loan balance would be recalculated and your subsequent loan payments would be reduced accordingly.

      If you have not elected the five-year maximum repayment period for your loan, you can change your repayment amount by requesting that TRS recalculate your loan for the maximum repayment period. Since you will be repaying the loan over a longer period of time, the amount of each regular loan payment would be reduced. Alternatively, you can ask TRS to recalculate your loan for a shorter repayment period, so that you can repay your loan faster.

      If you have not elected the five-year maximum repayment period for your loan, you can change your repayment amount by requesting that TRS recalculate your loan for the maximum repayment period. Since you will be repaying the loan over a longer period of time, the amount of each regular loan payment would be reduced. Alternatively, you can ask TRS to recalculate your loan for a shorter repayment period, so that you can repay your loan faster.

      When you have an outstanding loan and you take a new loan, each new loan requested would be treated as a separate loan, and each loan balance would be subject to the interest, insurance charges, and repayment terms in effect when the loan is issued.

      May I use a direct withdrawal to pay off a TDA loan?

      Yes. You may use the withdrawn money at your discretion.

      When would a loan go into default?

      If your loan is not fully repaid within five years, it is considered in default, and TRS would ask you to make a lump-sum repayment within 30 days. If you do not repay the amount within 30 days, the loan would become a taxable distribution and would be reported to the IRS. If you are not in active service, your loan would also go into default after you miss three scheduled monthly payments or, if you are a Tier I or II member with a QPP loan, after you miss one quarterly payment. If a TDA loan goes into default, tax consequences may include an IRS-imposed 10% penalty and an additional 20% withholding applied to any TDA funds you receive later that year.

      What happens if I have an outstanding loan balance when I retire?

      When you retire, any outstanding QPP or TDA loan balance would be deducted from your funds in the corresponding program, reducing the amount available for your retirement. In addition, the balance would be considered a distribution, and any taxable portion of the balance would be subject to 20% withholding. TRS would take this withholding from any subsequent cash payment made to you from the corresponding program in the same tax year. This would be a loan at retirement, and if necessary, a QPP excess withdrawal to a Tier I or II member, or a TDA withdrawal. If the withholding due were greater than the subsequent cash payment, TRS would issue you a check in a nominal amount of $10 and would take the balance of the payment towards your withholding obligation.

      May I roll over an outstanding or defaulted loan balance?

      The following loan amounts may be eligible for a rollover: a) the taxable portion of any outstanding QPP loan balance at the time of your retirement; b) if you are a non-vested Tier III, IV, or VI member, the taxable portion of any outstanding QPP loan balance at the time of your separation from service; and c) if you do not elect TDA Deferral status, any outstanding TDA loan balance at the time of your retirement or separation from service.

      May I transfer an outstanding loan balance to another retirement system?

      You may transfer the amount of your outstanding QPP loan if you are transferring your membership to one of the following retirement systems: the New York City Board of Education Retirement System; the New York City Employees' Retirement System; the New York State Teachers' Retirement System; or the New York State and Local Employees' Retirement System. In addition, if you are transferring your membership to the Board of Education Retirement System, you may transfer your outstanding TDA loan balance. The other retirement systems previously mentioned currently do not maintain a TDA loan program; therefore, your TDA loan balance cannot be transferred.

    • Payments

      When are retirement allowance checks distributed?

      Retirement allowance checks are mailed three business days before the end of the month. EFT funds are wired to financial institutions on the last day of the month.

      Is my first retirement allowance payment retroactive?

      Yes. If you receive advance payments, your first payment will be retroactive to your effective retirement date (or initial payability date, if you retired under deferred payability). Your first regular payment will contain the amount you are due from the date of retirement, minus any advance payment(s) you have received, plus applicable interest.

      What are advance payments?

      In order to provide you with retirement income as quickly as possible, TRS issues advance payments of your retirement allowance beginning with the payroll approximately one to two months following your effective retirement date (or initial payability date, if you retired under deferred payability). However, if your regular retirement allowance is available at that time, you would receive your regular retirement allowance instead.

      If TRS cannot finalize your retirement allowance within four months of your retirement date, we would increase the amount of your advance payments, so that they would be closer to the amount you will receive once your retirement is finalized.

      Advance payments are not estimates of your retirement allowance payments; in fact, your advance payments are designed to be smaller than your retirement allowance payments. The advance payment calculations do not reflect all the factors used to determine your retirement allowance payments. TRS calculates your advance payments based on your retirement plan choice, payment election, salary, and any applicable age-reduction factor. Total Service Credit is not used in the advance payment calculations.

      Can I pay my own federal taxes once I retire?

      Yes. However, you should ask the Internal Revenue Service or your tax consultant for advice regarding "estimated taxes" in order to avoid the possibility of penalties due to underpayment.

      Why does my monthly retirement allowance amount fluctuate?

      There are several possible explanations. For example:

      • Your first payment may contain retroactive funds, so subsequent payments may be smaller than your first payment.
      • Deductions for insurance and union dues may have begun (usually in the first few payments).
      • If you elect to change the amount of federal taxes withheld from your payments, the amount of your payments would be different after your federal withholding election is implemented.
      • If some of your funds are invested in the variable-return Passport Funds, the return on those investments would fluctuate from month to month.
      • A revision of your retirement allowance may have been implemented, in which case you would receive a revised Benefits Letter.

      How did TRS determine the number of units paid to me each month?

      When you retired, an actuarial calculation was made to determine the number of units you would be paid as part of your retirement allowance. The calculation was based on several factors, including the number of units you had at retirement, your retirement elections, and life expectancy. (If you chose to receive your TDA funds as an annuity, a similar calculation was made.)

      Please keep in mind that the number of units you will be paid will normally remain constant from month to month unless you transfer funds to or from a variable-return Passport Fund.

      How can I find out how many units I am being paid each month?

      The number of units paid to you monthly is indicated on your Electronic Fund Transfer (EFT) Quarterly Statements. If you receive your payments by check, this information is included on your retirement allowance and/or TDA annuity check stubs.

      if you are maintaining your TDA account after retirement through TDA Deferral status, your TDA Quarterly Statement shows how many units you have in each variable-return Passport Fund. This information is also available on your monthly online statements.

      What should I do if my retirement allowance check is late, lost, or stolen?

      You should file a lost check affidavit. There are three types of affidavits: the Affidavit for Check Lost after Receipt (code BK3); the Affidavit for Missing Check (code BK2); and the Affidavit for Forged Check (code BK1). A filed affidavit authorizes TRS to use the "Chemlink Quickquery" system to determine if a check is outstanding or if it has been paid. It also provides TRS with authorization to stop payment on a check, to create a duplicate check, or to revoke a stop payment on a check. If you are unsure if you have outstanding funds due you, you may access the Unclaimed Funds feature in the Resources section. This lists retirement allowance checks issued by TRS that have not yet been cashed.

      If I have a check from TRS that I did not cash within the 90-day time period allowed, what can I do?

      You may have a new check mailed to you by submitting a Check Reissue Request Form (code BK6). Your check would be reissued approximately 15 business days after TRS receives the form.

      Can I have my paystubs recreated in order to have a payroll record for this past income tax year?

      Yes. You may do so by sending a written request to TRS. However, please be aware that recreating paystubs can be a lengthy process.

      How is my retirement allowance taxed?

      QPP retirement allowance and TDA annuity payments generally are federally taxable and may be subject to state and local taxes; please check with your tax advisor.

      Are federal taxes withheld from my retirement allowance payments?

      Federal taxes will be withheld from your first retirement payment at the rate for a married person with three dependents, as required by the Internal Revenue Service (IRS). This rate would continue for all payments (both advance payments and regular retirement allowance payments) until you elect a new withholding rate.

      May I change my withholding elections?

      Yes. You may elect a new rate by filing an online election through the secure section of our website or by filing a Withholding Certificate for Pension or Annuity Payments (W-4P) with TRS.

      Please note that, if you have a permanent home address outside of the United States, Internal Revenue Service (IRS) regulations prohibit you from electing to have no federal income tax withheld from your retirement benefits.

      Your withholding election would generally take effect approximately two to six weeks after TRS receives your online W-4P filing, or approximately two months after TRS receives your paper form.

      How do I report the taxable portion of retirement funds issued to me?

      The taxable portion of these funds must be reported on your tax return. Taxable distributions from the Qualified Pension Plan should be reported under "total pensions and annuities." Taxable distributions from the TDA Program should be reported under "total IRA distributions."

      Why are there so many deductions from my retirement allowance payment?

      Your retirement allowance payment includes deductions for withholding tax, union dues, health insurance, and catastrophic life insurance.

      Who should I contact regarding deductions related to health insurance?

      All questions pertaining to health insurance should be directed to the New York City Health Benefits Program at 40 Rector Street, 3rd Floor, New York, NY 10006. The phone number is (212) 513-0470.

      Who should I contact regarding deductions related to union dues?

      You should contact your union directly.

      Do I receive a cost-of-living adjustment to my retirement allowance?

      Eligible retirees receive an annual cost-of-living adjustment (COLA) of between 1% and 3%, based on half of the Consumer Price Index increase for the year ending March 31. This increase is calculated on the lesser of the retiree's maximum fixed retirement allowance or $18,000.

      The following individuals are eligible for a COLA:

      • Retirees who are at least age 62 and have been retired for at least five years;
      • Retirees who are at least age 55 and have been retired for at least ten years;
      • Disability retirees who have been retired for at least five years;
      • Recipients of accidental death benefits who have been receiving their benefit for at least five years;
      • Designated annuitants who are a surviving spouse of a member who died prior to 1980, and who were entitled to a lump-sum benefit, but elected a lifetime annuity instead; and
      • Surviving spouses who are receiving a joint and survivor benefit, whose spouse, if alive, would have received a COLA benefit. (Note: Such individuals are eligible for half the COLA amount their spouse would have received.)

      Can I receive a letter stating that I am collecting my retirement allowance from TRS?

      Yes. You may submit a written request for a pension verification letter, or request one in person at TRS, as long as you provide proper identification.

      How can I apply for my Social Security benefits?

      For information regarding Social Security benefits, please contact the Social Security Administration at (800) 772-1213 between 7:00 a.m. and 7:00 p.m. on weekdays.

      What is a Benefits Letter?

      A Benefits Letter, which TRS sends each retiree, shows the member's monthly and annual retirement allowance amounts. In addition, it provides the specific information used to calculate the member's retirement allowance.

      When will I receive my Benefits Letter?

      You will most likely receive your Benefits Letter from TRS about one week before receiving your first retirement allowance payment. The letter is sent out after the processing of your retirement is completed.

      Why does my retirement allowance differ from the amount that my union representative calculated?

      The figures used by your union representative were estimates. Several factors included in the actual retirement allowance calculation may not have been known to your union representative when he or she made the estimate. These factors may have included changes in unit value, your recent investment elections, the payment option you chose, your Final Average Salary, your total service credit, and whether you took a loan or made an excess withdrawal at retirement.

      Why does the number of variable units shown on my QAS differ from the number of variable units used to compute my retirement benefits?

      The QAS indicates the number of your variable units at the end of each quarter of the calendar year. Unless you retired in the month following the end of a calendar quarter (i.e., January, April, July, or October), the number of variable units shown on your QAS would differ from the number of variable units used to compute your retirement benefit.

      What should I do if I disagree with information in the Benefits Letter?

      You should file a Benefits Letter Inquiry Form (code RC1) , along with a copy of the page of your Benefits Letter. Please highlight the information that you believe needs to be corrected, explain the discrepancy, and include supporting documentation.

      May I receive a duplicate Benefits Letter?

      Yes. In order to receive a duplicate Benefits Letter, you must submit a written request to TRS at 55 Water Street, New York, NY 10041. Please include your name, address, retirement number, and Social Security number in this request.

      What is EFT?

      E-F-T stands for Electronic Fund Transfer. This service enables TRS retirees to have their monthly benefit payments (and other distributions) electronically forwarded to their checking or savings account. In-service members who are paid on the City of New York payroll through direct deposit may choose EFT for their QPP and TDA loans and TDA direct withdrawals. EFT allows members' accounts to be credited on the payment date and safeguards against delayed, lost, or stolen checks.

      How does EFT work?

      By the last day of every month, the City of New York will transmit your payment to your financial institution for deposit in your designated account. Under the EFT system, you will no longer receive a check stub, but you will receive an EFT Quarterly Statement detailing your monthly payments. In addition, you will be able to view payment details each month after logging on to our website.

      The monthly transactions will also appear on statements from your financial institution. (Note that statements from your financial institution will reflect the date a payment was credited, whereas TRS statements will reflect the date a payment was disbursed.)

      Is EFT available for payments other than retirement benefits?

      EFT is available for other payments, as noted below.

      If you are an in-service member paid on the City of New York payroll through direct deposit, you may elect to receive QPP loans or QPP direct withdrawals via EFT in the same account where you receive your pay. You would automatically receive a TDA loan or TDA direct withdrawal via EFT, unless you elect to receive these distributions by check.

      If you are a retiree with TDA Deferral status and you are receiving your retirement allowance via EFT, you would automatically receive a TDA loan and TDA direct withdrawal via EFT in the same account where you receive your benefit payments, unless you elect to receive these distributions by check. You would automatically receive a Required Minimum Distribution (RMD) via EFT.

      How can I initiate EFT at retirement?

      If you are currently paid on the City of New York payroll through direct deposit for work in a position that entitles you to TRS membership: You will be automatically enrolled to receive your monthly benefit payments (including advance payments) via EFT. You do not need to do anything; these payments will be automatically deposited in your account via EFT. However, if you want your monthly benefit payments (including advance payments) to be deposited via EFT in a different account, you must file an EFT Election at Retirement Form (code BK66).

      If you are currently paid on the City of New York payroll through direct deposit for work in a position that does not entitle you to TRS membership (e.g., substitute or per diem teacher): You must file an EFT Election at Retirement Form if you want your monthly benefit payments (including advance payments) to be deposited via EFT.

      If you are not currently paid on the City of New York payroll through direct deposit: You must file an EFT Election at Retirement Form if you want your monthly benefit payments (including advance payments) deposited via EFT.

      Retiring TRS members who are not currently paid on the City of New York payroll through direct deposit MUST file either an EFT Election at Retirement Form or an Opt Out of EFT at Retirement Form (code BK67) in order to receive their advance and/or regular retirement allowance payments. Failure to file one of these forms would result in a delay in the payment of benefits.

      These two forms are available on request from our Member Services Center (not from our website). Members who are retiring should speak with a Member Services Representative for more information about EFT.

      How can I initiate or change my EFT account after retirement?

      If you are a retiree (or beneficiary) who is receiving monthly benefit payments, you should complete an EFT Authorization Form (code BK58) to either enroll in EFT or to change your existing EFT account. You must return the completed form, along with required documentation, to TRS.

      On what day will funds be deposited in my account under EFT?

      Under the EFT system, funds are deposited in your account on the day the payment is issued. Monthly benefit payments, withdrawals, and other distributions are generally issued by the last day of each month. In order for a loan payment to be forwarded to your account via EFT by a given Friday, TRS must generally receive your loan application by the close of business on Wednesday of the preceding week. All payments deposited via EFT are available for immediate withdrawal.

      Can one EFT Authorization Form (code BK58) or EFT Election at Retirement Form (code BK66) be filed to receive both QPP retirement allowance payments and TDA annuity payments through EFT?

      Yes, as long as the payments are to be deposited in the same account. You must indicate this on your EFT Authorization Form or EFT Election at Retirement Form.

      May different types of monthly benefit payments be deposited in different accounts?

      Yes, by filing a separate EFT Authorization Form (code BK58) or EFT Election at Retirement Form (code BK66), as applicable, for each account.

      Please note that you cannot submit an EFT Authorization Form or EFT Election at Retirement Form in order to receive a QPP or TDA loan via EFT. QPP and TDA loans can be distributed electronically only if you are already receiving your paychecks through direct deposit or retirement allowance payments through EFT.

      On the EFT Authorization Form (code BK58) or EFT Election at Retirement Form (code BK66), should I check off "savings" or "checking" if my EFT will be made to a money market account?

      Members should contact their bank to determine if the money market account is considered a checking or a savings account.

      What happens after I file an EFT Authorization Form (code BK58) and/or an EFT Election at Retirement Form (code BK66)?

      If you filed an EFT Authorization Form , your EFT would generally begin within 15-45 days after TRS' receipt of your correctly completed form. If you filed an EFT Election at Retirement Form, your EFT would begin with your first monthly benefit payment. If you did not complete your form correctly, TRS would send you a letter indicating why your EFT could not be processed, and including further instructions and a new form to file, as applicable.

      Before your EFT begins, TRS will send you a letter confirming the type of account (i.e., checking or savings), account number, transit routing number, and the financial institution to which payments are to be deposited. If you currently receive your monthly benefit payments via paper checks, your confirmation letter will also indicate when your EFT will start, as well as the date of your final paper check.

      May I stop my EFT and have my checks mailed to me?

      You may cancel your EFT at any time by filing an EFT/Direct Deposit Cancellation Request Form (code BK19) with TRS. (To cancel EFT of payments made to two different accounts, you must file a separate form for each account.) The cancellation of your EFT should take effect on the first payroll that occurs 15-45 days after TRS receives this form; you will then begin to receive paper checks by mail. You may reinstate your EFT by filing another EFT Authorization Form (code BK58) with TRS.

      What may cause my EFT to stop?

      If your account is closed, your account number is modified, or your financial institution closes or merges with another, your payment cannot be credited, and your EFT would be automatically suspended. TRS would notify you by letter if this occurs, and you would then receive future payments by check at your home address. To reinstate your EFT in this case, you would need to file another EFT Authorization Form (code BK58) . Your EFT should resume within 15-45 days after TRS' receipt of your correctly completed form.

      To request a paper check replacement for any uncredited EFT payment(s), you may write to TRS' Banking Unit at 55 Water Street, New York, NY 10041.

      Can I change the account or financial institution to which my EFT is sent?

      Yes. To do so, you should file an updated EFT Authorization Form (code BK58).

      What should I do if my account information or personal information changes?

      If your account number changes (within your financial institution), or if you are changing financial institutions, you must notify TRS by filing an updated EFT Authorization Form (code BK58). To avoid interruption of your EFT, TRS would need to receive your form at least 45 days prior to the change.

      It is important that you notify TRS whenever your address changes. If you are an in-service member or retiree, you may change your address either by accessing our website or by filing a paper Member's Change of Address Form (code DM13) with TRS. If you are a beneficiary, you may change your address by filing a paper Beneficiary's Change of Address Form (code DM14). Failure to notify TRS when your address changes will not interrupt your EFT; however, it may prevent you from receiving your EFT Quarterly Statements, tax documents, and other important correspondence from TRS.

      How often will I receive EFT statements?

      TRS issues EFT statements for monthly retirement allowance and TDA annuity payments on a quarterly basis. For loans and other payments disbursed through EFT, a letter confirming the deposit will be sent to your home address. You may also view a secure online record of your monthly payments by accessing our website. Payments will be available for viewing approximately one week after the pay date; up to three years of payment history will be available.

    • TDA Program

      How can I change the way my TDA contributions are invested?

      In-service TDA participants, members with TDA Deferral status, and TDA annuitants may change their TDA investment elections four times a year. Investment election changes take place on the following conversion dates: January 1, April 1, July 1, and October 1.

      In-service TDA participants may change their investment elections for their future TDA contributions and/or past TDA accumulations by logging in to the secure section of our website or by filing a paper TDA Investment Election Change Form (code TD45) at any time; their elections would take effect on the next conversion date that occurs at least 30 days after TRS receives their form or online request.

      Members with TDA Deferral status may change their investment elections for their TDA accumulations by logging in to the secure section of our website or by filing a paper TDA Investment Election Change Form (code TD45) at any time; their elections would take effect on the next conversion date that occurs at least 30 days after TRS receives their form or online request.

      TDA annuitants may change their investment elections for their TDA accumulations by filing a paper TDA Annuitant's Investment Election Change Form (code RP9) at any time; their elections would take effect on the next conversion date that occurs at least 60 days after TRS receives their form.

      Why didn't my TDA investment election changes take effect in my account?

      In general, TDA investment election changes made by in-service TDA participants and members with TDA Deferral status take effect on the next conversion date that occurs at least 30 days after TRS receives their form or online request. If your elections have not taken effect in that time frame, then TRS may not have received your TDA Investment Election Change Form (code TD45) or online request, at least 30 days before the next conversion date. In such a case, your elections would take effect on the following conversion date.

      In general, TDA investment election changes made by TDA annuitants take effect on the next conversion date that occurs at least 60 days after TRS receives their form. If your elections have not taken effect in that time frame, then TRS may not have received your TDA Annuitant's Investment Election Change Form (code RP9) at least 60 days before the next conversion date. In such a case, your elections would take effect on the following conversion date.

      Can I stop investment election changes already in progress?

      In-service Tier I and II members under the QPP, all in-service TDA participants, and members with TDA Deferral status may file a new investment election change form or online equivalent; in this case, any 6-, 9-, or 12-month conversions in progress but not yet completed would stop as of the date the new election takes effect. However, any 1- and 3-month conversions in progress cannot be stopped because they would be completed by the next effective date.

      For Tier I and II retirees under the QPP and all TDA Annuitants, in-progress conversions cannot be canceled before they are completed. However, they may submit a new investment election change form to make investment elections for any portion of their QPP or TDA funds that have not been affected by any in-progress investment election changes.

      When will I receive my TDA Quarterly Statement?

      TDA Quarterly Statements are mailed to members with TDA Deferral status approximately five to six weeks after the end of the quarter.

      How can I correct an error on my TDA Quarterly Statement?

      You may send a copy of the statement, along with a letter indicating the requested correction, to TRS, Member Accounting Unit, 55 Water Street, New York, NY 10041.

      May I use a direct withdrawal to pay off a TDA loan?

      Yes. You may use the withdrawn money at your discretion.

      What are the tax consequences of making a Direct Withdrawal?

      Direct Withdrawals of TDA funds are generally taxable. Other than hardship withdrawals, TRS is required to withhold 20% of any taxable amount over $200 you withdraw and do not instruct TRS to directly roll over to an eligible successor program(s). If you receive a Direct Withdrawal and do not roll over the distribution within 60 days of the withdrawal check, the withdrawal would generally be federally taxable and may be subject to state and local taxes. The IRS may impose an additional 10% tax on all Direct Withdrawals unless the withdrawal is made: a) in conjunction with your separation from service during or after the year in which you attain age 55; or b) during or after the year you attain age 59½; or c) as a qualified hardship withdrawal; or d) in conjunction with your disability retirement; or e) by your beneficiary in conjunction with a death benefit payment.

      TRS suggests that you consult with your tax advisor should you have any specific tax questions.

      When can I expect to receive my TDA withdrawal?

      TRS would issue your distribution of TDA funds as follows:

      • For partial withdrawals drawn only from your balance in the Fixed Return Fund: Generally within 15 days of TRS' receipt of your withdrawal request.
      • For all other withdrawals: Generally within 45 days of TRS' receipt of your withdrawal request.

      How are Direct Rollovers and Direct Transfers different from Direct Withdrawals?

      If you make a Direct Withdrawal, TRS sends the withdrawn amount directly to you. If you make a Direct Rollover, TRS sends the withdrawn amount directly to the IRS-qualified Individual Retirement Arrangement (IRA) or other eligible successor program that you elect. Unlike Direct Withdrawals, Direct Rollovers are not subject to current taxes and penalties. If you make a Direct Transfer, TRS sends the withdrawn amount directly to the IRS-qualified Section 403(b) Program that you elect. However, as a result of new IRS regulations governing Section 403(b) Programs, TRS, on the advice of outside tax counsel, has suspended all processing of Direct Transfers pending further clarification from the IRS.

      What unit value will be used to calculate a TDA withdrawal?

      In most cases, the unit values used would be the unit values in effect for the month after TRS' receipt of your TDA Withdrawal Application (code TD32) or online equivalent.

      However, as described on the TDA Withdrawal Application, different unit values would be used for withdrawals that are taken after the expiration of TRS membership rights or in conjunction with the withdrawal of QPP accumulations.

    • 1099 Forms

      When does TRS mail out 1099 Forms?

      1099 Forms for a given year are generally issued by the following January 31.

      May I view my 1099 Forms online?

      Members with active TRS accounts who received a lump-sum distribution from TRS may view their current 1099 Forms online by logging in to the secure section of our website. (However, if a 1099 Form was corrected in a given year, members would be unable to view either the original form or the corrected form online.) Please note that TRS will continue to mail paper forms, including corrected forms, to all members. If you have any questions about the distributions reported on your online or hardcopy 1099 Forms, please file a 1099-R/1099-INT Inquiry Form (code GA5) with TRS.

      What is reported on the 1099 Forms?

      TRS issues a separate 1099-R Form for each of the following types of distributions:

      • Taxable excess withdrawals, including those taken at retirement;
      • Defaulted loans and taxable loans taken at retirement;
      • Advance payments from the Qualified Pension Plan (QPP);
      • Retirement allowance payments from the QPP;
      • Annuity payments from the Tax-Deferred Annuity (TDA) Program;
      • TDA and QPP Direct Withdrawals and Direct Rollovers;
      • TDA Required Minimum Distributions (RMDs);
      • Death benefit payments;
      • Lump-sum disability payments;
      • Withdrawals of funds upon separation from service; and
      • Refunds of erroneous contributions.

      Generally, TRS issues a separate 1099-INT Form for any interest payments associated with a distribution listed above. However, the full amount of any Direct Rollover is reported on a 1099-R Form, including any portion of the Direct Rollover that is attributable to interest.

      Why was I issued more than one 1099-R?

      A separate 1099-R Form must be issued for each distribution from TRS.

      Why was I issued a 1099-R even though I rolled over my funds?

      TRS must issue a 1099-R Form even if a distribution was rolled over.

      May I receive a duplicate 1099 Form?

      Yes. You may request a duplicate 1099 Form by filing a 1099-R/1099-INT Inquiry Form (code GA5) with TRS. Duplicates are usually processed within 15 business days after TRS' receipt of your request.

      Members with active TRS accounts who received a lump-sum distribution from TRS in the past two years may also request a duplicate of the associated 1099 Form online by logging in to the secure section of our website. However, if a 1099 Form was corrected in a given year, members would be unable to view either the original form or the corrected form online.

      Of the sum represented on the 1099-R Form, which portion is tax-free and which portion is taxable?

      The tax-free amount is listed in box #5; the taxable amount is listed in box #2a.

      What does "not determined" mean on the 1099 Form?

      "Not determined" is an indication that not all of the facts are available to figure the taxable amount. If you are a retiree, your Benefits Letter may help you calculate the amount. You may also wish to consult the following IRS publications: #571—Tax-Sheltered Annuity Programs for Employees of Public Schools and Certain Tax-Exempt Organizations; #575—Pension and Annuity Income; #590—Individual Retirement Arrangements; #721—Tax Guide to U.S. Civil Service Retirement Benefits; and #939—Pension General Rules.

      Why didn't I receive a 1099 Form from TRS?

      TRS may not have made a taxable or tax-deferred distribution to you or on your behalf during the year. However, if you received a distribution, or if TRS processed a direct rollover of your QPP and/or TDA funds during the year, you should have received a 1099 Form. If you changed your address without notifying TRS, the 1099 Form would have been sent to your previous address.

      You may update your permanent address with TRS by logging in to the secure section of our website, or by filing a paper Member's Change of Address Form (code DM13) with TRS.

      Members with active TRS accounts who received a lump-sum distribution from TRS in the previous year may view their current 1099 Forms online by logging in to the secure section of our website. In addition, they can request a duplicate copy for any of their current 1099 Forms. However, if a 1099 Form was corrected in a given year, members would be unable to view either the original form or the corrected form online.

    • Withdrawals/Distributions

      What is the QPP?

      Q-P-P stands for the Qualified Pension Plan. This defined-benefit plan, administered under Section 401(a) of the Internal Revenue Code, enables TRS members to receive a monthly retirement allowance upon meeting certain eligibility requirements.

      What is an RMD?

      R-M-D stands for a Required Minimum Distribution. This is the amount that certain participants in TRS' TDA Program must receive from their TDA funds in a given year to meet the distribution regulations of the Internal Revenue Service. RMDs apply only to TDA participants who have separated from service, are at least age 70½, and have TDA Deferral status. It is important to note that the IRS imposes a 50% excise tax on any amounts that are required to be distributed for a given year, but are not.

      What are the tax consequences of making a Direct Withdrawal?

      Direct Withdrawals of TDA funds are generally taxable. Other than hardship withdrawals, TRS is required to withhold 20% of any taxable amount over $200 you withdraw and do not instruct TRS to directly roll over to an eligible successor program(s). If you receive a Direct Withdrawal and do not roll over the distribution within 60 days of the withdrawal check, the withdrawal would generally be federally taxable and may be subject to state and local taxes. The IRS may impose an additional 10% tax on all Direct Withdrawals unless the withdrawal is made: a) in conjunction with your separation from service during or after the year in which you attain age 55; or b) during or after the year you attain age 59½; or c) as a qualified hardship withdrawal; or d) in conjunction with your disability retirement; or e) by your beneficiary in conjunction with a death benefit payment.

      TRS suggests that you consult with your tax advisor should you have any specific tax questions.

      When can I expect to receive my TDA withdrawal?

      TRS would issue your distribution of TDA funds as follows:

      • TRS suggests that you consult with your tax advisor should you have any specific tax questions.
      • For all other withdrawals: Generally within 45 days of TRS' receipt of your withdrawal request.

      How are Direct Rollovers and Direct Transfers different from Direct Withdrawals?

      If you make a Direct Withdrawal, TRS sends the withdrawn amount directly to you. If you make a Direct Rollover, TRS sends the withdrawn amount directly to the IRS-qualified Individual Retirement Arrangement (IRA) or other eligible successor program that you elect. Unlike Direct Withdrawals, Direct Rollovers are not subject to current taxes and penalties. If you make a Direct Transfer, TRS sends the withdrawn amount directly to the IRS-qualified Section 403(b) Program that you elect. However, as a result of new IRS regulations governing Section 403(b) Programs, TRS, on the advice of outside tax counsel, has suspended all processing of Direct Transfers pending further clarification from the IRS.

      What unit value will be used to calculate a TDA withdrawal?

      In most cases, the unit values used would be the unit values in effect for the month after TRS' receipt of your TDA Withdrawal Application (code TD32) or online equivalent.

      However, as described on the TDA Withdrawal Application, different unit values would be used for withdrawals that are taken after the expiration of TRS membership rights or in conjunction with the withdrawal of QPP accumulations.

      Can I change my RMD options after filing my RMD Election Form (code TD39)?

      You may change your RMD options by filing a new RMD Election Form. However, TRS must receive your new form at least 60 days before the expected RMD payment date, based on your elections on the previous form. (For example, if your RMD payment date would have been the last business day of December, TRS must receive a new form by the end of October.)

      Do I have to withdraw or roll over my total TDA account balance when I reach age 75?

      No. If you are maintaining a TDA balance through TDA Deferral status, you would need to begin receiving an RMD that is based on your entire TDA balance. If you are receiving your TDA funds as an annuity, your TDA payments would continue as usual.

      When am I required to begin receiving a minimum distribution on my TDA funds?

      In general, the IRS requires that TDA distributions begin if you have left service (having elected TDA Deferral status) and have reached or will have reached age 70½ by December 31 of a given year. In most cases, you will have to meet minimum distribution requirements for every year that you maintain a TDA balance. The amount you must receive is called your Required Minimum Distribution (RMD).

      If you have retired (or are retiring), a TDA annuity would meet your RMD requirements as long as the annual amount of the annuity payment is equal to or greater than your RMD amount for that year. (Note: A separate distribution may be required for the year that you elect to annuitize your TDA funds.)

      Will I receive notification when I need to take a Required Minimum Distribution (RMD)?

      Yes. Each year, TRS sends a comprehensive RMD packet to members who are subject to distribution requirements for the year. This packet includes a letter indicating the RMD amount for that year, as well as an RMD Election Form (code TD39).

      How is my RMD amount calculated?

      Your annual RMD amount for a given year is determined by applying an actuarial factor from an IRS life-expectancy table to your applicable TDA balance. The actuarial factors used to calculate your RMD will change every year, as will the amount of your required distribution. If your spouse is more than 10 years younger than you, and is your sole primary TDA beneficiary, your spouse's date of birth will be factored into your RMD calculation.

      If you are a retiree between ages 70½ and 75, your RMD amount is calculated based on your Post-1986 TDA balance as of December 31 of the previous year. Your Post-1986 TDA balance is determined by subtracting your Pre-1987 balance from your total TDA balance as of December 31 of the previous year.

      If you are a retiree age 75 or older, your RMD amount is calculated based on your total TDA balance as of December 31 of the previous year.

      If I have more than one TDA beneficiary, which one is considered when calculating my RMD?

      The only time during your lifetime that an actual beneficiary is used to calculate your RMD is when your spouse is more than ten years younger than you, and is your sole primary TDA beneficiary. Otherwise, your RMD is calculated as if you have a beneficiary who is ten years younger than you. After your death, the life expectancy of your oldest beneficiary is considered when determining your final RMD.

      Are there different ways that I can receive my RMD amount?

      Yes. You have several choices: You may receive an RMD payment from TRS for the required amount; you may make a Direct Withdrawal of an amount equaling or exceeding your RMD amount; you may elect to annuitize your funds; or you may satisfy the RMD requirement by receiving payments from another Section 403(b) Program.

      If I receive a distribution from my IRA, can it take the place of my receiving an RMD from my TDA funds?

      No. Only a payment from another Section 403(b) Program can take the place of receiving a distribution from TRS' TDA Program in order to meet RMD requirements.

      Is it possible for my TDA beneficiaries to get an annualized RMD payment?

      Generally, RMD payments are made only to members. However, after a member dies, the member's beneficiary(ies) may defer distribution of TDA death benefits by establishing a TDA account with TRS. In this case, if the member had been receiving RMD payments, these distributions would continue to be made to the beneficiary(ies) in accordance with Internal Revenue Service (IRS) guidelines.

      Can RMD payments be rolled over?

      No. They must be received by the member (or, when applicable, a beneficiary who has established a TRS TDA account).

      What are the tax consequences of receiving an RMD?

      All RMD amounts are taxable in the year in which they are distributed. This is true even in the case of distributions for a given year that are made by the following April 1; they are taxable in that following year even though they represent the preceding year's RMD. On the RMD Election Form (code TD39), members may elect the percentage of the RMD amount to be withheld for federal taxes; the percentage must be a whole number from 0 to 100. Any federal tax withheld can be claimed as tax paid on the member's federal income tax return for the year of distribution. For new Direct Withdrawals that are used to meet RMD requirements, 20% withholding will be applied to any amounts distributed in excess of the RMD unless those excess amounts are directly rolled over or directly transferred.

      It is important to note that the IRS imposes a 50% excise tax on any amounts that are required to be distributed for a given year, but are not.

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