A. Three year FAS
1. Three highest consecutive years of regular salary-highest
36 consecutive months
a. .Normally will be last three years
2. Three year FAS CANNOT include:
a. termination pay
b. retirement bonuses
c. pay for unused sick days
d. Regular salary increases exceeding 20% for one year (Tier I);
20% for previous two years
(Tier II); 10% for previous two years
(Tiers III and IV)
B. Five year FAS - FOR THOSE MEMBERS
WHOSE DATE OF MEMBERSHIP IS PRIOR TO JUNE 17,1971
1. Five highest consecutive years of salary - highest 60 consecutive months
2. Can include those items excluded in three year FAS
3. Both three and five year FAS will be figured and highest used
TIER 1 - PRE-JULY 1, 1973 MEMBERSHIP DATE
A. Allowance calculation
1. 1.8% of FAS for service before July 1, 1959
2. 2.0% of FAS for service since July 1, 1959
3. 1.0% of FAS for credited out-of-state service up to a maximum of 35 years total service
4. 79% of FAS is maximum pension
5. Annuity, if any, is in addition to pension
B. Annuity - MONIES CONTRIBUTED BY THE MEMBER
1. Leave it all in for annuity benefit
2. Take it all out
Direct rollover to IRA or qualified plan
Payment to member - tax assessment of 20% withholding
"ROLLOVER"
Since January 1, 1993, any or all of the taxable portion of a special service reftmd has been eligible to be transferred directly to an IRA or qualified plan. In all cases, the non-taxable portion of the reftmd is paid directly to the member. The System is required to withhold 20 percent of the taxable amount not transferred directly. This withholding is not a penalty but regular withholding. If the member does not elect a direct transfer, the taxable portion, less 20 percent withholding, will be paid directly to the member. The member still has 60 days from the date of the transaction to roll over any or all of the taxable portion.
All distributions made by this System are specifically exempt from New York State Income Tax.
In January of each year, IRS Form 1099R is mailed to all members who had a taxable loan distribution, loan closeout andlor refund in the previous calendar year.
For specific information regarding payments made by this System, you may contact the Finance Department by writing or by telephoning 1-800-348-7298, ext. 6120 or 518-447-2900 ext. 6120.
TIER 1 - PENALTIES
A. With less than 20 years of service there is a 5% penalty for each year
TIER II - JULY 1, 1973 TO JULY 26,1976 MEMBERSHIP DATES
A. Similar to Tier I
1. 2% of FAS
2. 79% of FAS maximum pension
3. 5% penalty for less than 20 years service
B. Additional Reduction
1. Additional penalty for retirement between 55-62 with less than 30 years credited service: see Benefit Pamphlet for reduction schedule.
TIER III - JULY 27,1976 TO AUGUST 31,1983 MEMBERSHIP DATES
A. Allowance Calculation
1. Each year of service up to 20 years calculated at 1-2/3% of three years FAS
2. 20 or more years of service is calculated at 2% per year
to a 30 year maximum
(i.e. 60% of FAS maximum pension)
3. Less than 30 years of credited service a penalty based upon
ages (55-61)
a. 6.7% reduction at age 61
b. 30% reduction at age 55
4. At age 62 your New York State Teachers' Retirement System retirement benefit is reduced by 50% of Social Security benefit earned from NYS public employment (Social Security offset provision)
TIER III MEMBERS WILL RECEIVE A LARGER BENEFIT UNDER TIER IV. TIER IV ALLOWS CREDIT FOR YEARS OF SERVICE BEYOND 30 YEARS AND DOES NOT HAVE A SOCIAL SECURITY OFFSET. TIER III MEMBERS MAY CHOOSE TIER IV RETIREMENT BENEFITS AT TIME OF RETIREMENT.
TIER IV - MEMBERSHIP DATE: SEPTEMBER 1, 1983 TO THE PRESENT
A. Allowance Calculation
1. May retire at age:
a. 55 with 30 years of credited service
b. 62 with 10 years of credited service
c. 70 with 5 years of credited service
2. Less than 20 years of credited service receive 1-2/3% of three
year FAS
3. 20 to 30 years of credited service at 2% of FAS
4. 1.5% of FAS for each year past 30 years
5. Unlimited percentage of FAS maximum pension
6. Less than 30 years of credited service a penalty based upon
ages (55-6 1):
a. 6.7% reduction at age 61
b. 38.3% reduction at age 55