5.20 E. Pension Payment Procedures

1. Effective Date And Initial Payment

(Also refer to 6.30 To Close an Account.) IMRF pensions are effective as of the first day of the month after participation terminates (after the last date of participation as indicated on the termination form).

Examples:

• The member’s last day of participation indicated on the termination form is May 15. The pension effective date is June 1.

• The member’s last day of participation indicated on the termination form is June 1. The pension effective date will be July 1.

• The member’s last day of participation indicated on the termination form is May 15 but the member is paid for sick, vacation or personal time on May 30 and on June 15. The pension effective date is June 1. A member can be considered terminated on May 15 even though he or she is receiving compensation through June 15.

However, if the member is still considered to be an employee until June 15 (that is, the last day of participation indicated on the termination form is June 15), the pension effective date will be July 1.

Note: IMRF can accept wages that are paid no later than one month after the month of termination. For example, if you report the member’s termination date as May 15, IMRF cannot accept wages paid later than June 30.

The first check the member receives may be for more than one month’s payment. Payments, thereafter, are payable on the first day of the month for that month. For example: A check dated on January l pays benefits through January 31.

If the member will receive a refund of surviving spouse, SLEP IMRF’s Sheriff’s Law Enforcement Personnel plan is available to county sheriffs, deputy sheriffs, forest preserve rangers and airport police and certain police chiefs. IMRF’s Sheriff’s Law Enforcement Personnel plan was revised by P.A. 94-712, which resulted in the creation of two “tiers” as follows: SL01 SLEP Tier 1, members who terminated SLEP participation before July 1, 2004, and SL02 SLEP Tier 2. The contribution rate was increased to 7.50% effective on and after June 1, 2006. P.A. 94-712 also increased the SLEP formula to a flat 2.5%. The new formula applies to SLEP members who were actively participating on or after July 1, 2004., or Voluntary Additional contributions IMRF members have the option of making after-tax voluntary additional contributions to provide a supplemental retirement benefit in addition to the usual IMRF retirement pension. These after-tax voluntary additional contributions are limited to 10% of gross earnings and are not matched by the employer. The additional retirement benefit is based solely upon the accumulated voluntary contributions plus interest. The rate of interest paid is currently 7.25%. Interest is credited to each account at the end of the year. Interest is based upon the opening balance at the beginning of the year., those contributions plus interest will be refunded separately. IMRF will mail the member a letter explaining his or her options for payment of the refund.

(The member may be able to receive the refund as an additional monthly annuity, see 5.20 B. 13.b. Methods of Payment) Before IMRF can process a lump sum refund, the member must complete and return Form BW-60, "Distribution/ Rollover Certification" (view Exhibit 5L).

Download and Print Form BW-60

IMRF will mail the member a Distribution/Rollover Certificate with a letter informing him/her of the taxable and non-taxable amounts of the refund.

The first pension payment usually is made two to three weeks after IMRF receives Form 5.20, ”Application for IMRF Pension,” from the member and notice of termination of participation from the employer A unit of government that joins IMRF..

Download and Print Form 5.20

Go to the Employer Access area to Terminate IMRF Participation

If IMRF hasn’t received the wage report listing the member’s last earnings and contributions, the first pension payment will be an approximate payment. The final pension payment amount will be calculated after IMRF receives the member’s final wage report.

The first pension payment is always based upon IMRF’s standard payout (see 5.20 B. 2. IMRF Pension Calculation Illustration).

If a member is eligible for the optional payout (Tier 1 member under age 62), IMRF will mail an option letter to the member explaining his or her payment options after IMRF receives the member’s final earnings information.

The member will have 90 days in which to choose either a standard or optional pension. If the member does not advise us that he or she wishes to receive an optional pension, IMRF will assume the member wishes to continue to receive a standard IMRF pension.

2. Certificate of Benefits

The ”Certificate of Benefits” (view Exhibit 5M-a) explains the IMRF pension and provides information about subsequent pension payments, death benefits, and income tax information. A member's Certificate of Benefits will not be mailed until IMRF receives the member's final wage report.

If the member is eligible for the optional plan (Tier 1 member under age 62), IMRF will mail the Certificate after the member returns the option letter indicating his or her payment choice.

If the member is age 62 or older, IMRF will mail the Certificate after IMRF receives the wage report listing the member’s last earnings and contributions.

If the member retired under the Reciprocal Act, IMRF will mail the Certificate after IMRF receives the final wage information from the member’s reciprocal system(s).

3. Direct Deposit of IMRF Pension Checks

The member will receive his or her monthly benefit payment by Direct Deposit.

Direct Deposit ensures the security of a member’s monthly pension by having the payment electronically deposited into the member’s checking, savings, or brokerage account.

If a member does not provide Direct Deposit information with the retirement application, he or she can complete, IMRF Form 1199, ”Authorization for Direct Deposit” (view Exhibit 5K).

The form must be completed by the member and returned to IMRF.

Benefit payments will be suspended after three months if the member does not return a completed Form 1199.

Download and Print Form 1199

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