Like any other refund of member contributions that is paid when a member stops participating in IMRF, separation refunds under the ECO plan are payable without interest. If you choose to stop participating in the ECO plan, you
- Cannot convert the ECO service credit back to Regular or SLEP by taking a refund of the extra ECO contributions.
- Cannot receive a refund of any difference between the ECO contribution rate and the Regular or SLEP contribution rate without taking a refund of your total member contributions and forfeiting all IMRF service credit.
Federal Withholding on Refunds
IMRF is required by federal law to withhold 20% of the taxable portion of your refund unless you elect to have the taxable portion directly rolled over into a traditional IRA (not a Roth IRA) or other qualified retirement plan.
If you are under age 59 1/2, you may also be liable for an additional 10% tax on the taxable portion of your refund. You may defer the additional 10% tax by directly rolling your refund into a traditional IRA or other qualified pension plan.
Former public safety employees are not subject to the additional 10% tax if the member was age 50 or older when he or she stopped working for his or her IMRF employer.
Refund of Member Contributions
Like any other refund of member contributions that is paid when a member stops participating in IMRF, separation refunds under the ECO plan are payable without interest.
You are not eligible for a refund if you stop participating in IMRF but continue working for the same employer.
When you take a refund of your IMRF contributions, you give up all of your IMRF benefits. You will not be eligible for any retirement or disability benefit, and your beneficiary(ies) will not be entitled to any death benefit.
How to Apply for Your Refund
You can apply for a refund online:
- Sign in to your Member Access account
- Select the Tools tab
- Select Secure Online Forms
You can also complete a paper "Application for Separation Refund" form and mail or fax it to IMRF at (630) 706-4289.
Repaying a Refund
If you stopped participating in IMRF and took a refund of your contributions, you may redeposit those withdrawn contributions with interest and reinstate your months of service credit. When a member wishes to repay a refund and re-establish the service credit, the member purchases Reinstated service credit.
To be eligible to repay your refund, you must be currently participating in IMRF or another Illinois reciprocal system and you must have contributed for at least two years following the date of your last refund. If you return as a SLEP member or as a sheriff in the ECO plan, you can repay the refund after working enough hours to meet your employer’s IMRF hourly standard (either 600 or 1,000 hours).
To find out how much it would cost to repay refund and reinstate your service credit, submit an "Application for Reinstatement of Service Credit."