After you have retired and have received pension payments for at least 12 months in a row, you will receive a supplemental payment every July. You will receive this "13th Payment" approximately one week after your usual July payment.
Becoming Eligible for the 13th Payment
You must always receive IMRF pension payments for the previous 12 months in a row in order to receive a 13th Payment. When you first retire, you must have retired on or before June 30 to receive a 13th payment the next year. For example:
|If you retire…||You will receive your first 13th Payment in…|
|On or before June 30, 2015||July of 2016|
|After June 30, 2015||July of 2017|
Once you receive your first 13th Payment, you will receive one every year unless your pension payments are suspended for some reason, such as for a return to work for an IMRF employer.
If you are receiving a surviving spouse pension, you will be eligible for the 13th payment if your deceased spouse's pension would have been eligible for the 13th payment in that year.
Amount of Payment
The 13th payment is not the same amount as your usual monthly pension payment, it is a percentage of your June payment amount. In 2016, the 13th Payment will be about 32% of your June 2016 payment.
Each June IMRF calculates the percentage of the 13th payment for that year. The percentage is based on the total of:
- Employer contributions (.62% of member payroll) and
- All June payments to everyone eligible for the 13th payment.
IMRF divides the first number by the second number to arrive at the 13th payment percentage.
Amount is Getting Smaller
The 13th payment amount is getting smaller every year. The pool of money available for the 13th Payment is a percentage of the total amount of IMRF employers' payroll. Employer payroll amounts are based on the number of employees working. Since the number of retirees eligible for the 13th payment is growing faster than the number of members currently working, a larger amount of people must share a smaller pool of money.
13th Payment Statements
You will receive a paper direct deposit statement for your 13th payment. Because your 13th payment is directly deposited into your checking or savings account, your 13th payment may be in your account before you receive your direct deposit statement in the mail. Your statement will be available for viewing in Member Access before you receive your paper statement.
Income Taxes on 13th Payments
Your 13th payment is subject to federal income tax but not to Illinois income tax. (Illinois does not tax any retirement income, including IMRF pension payments.)
We calculate the amount of federal withholding by looking at your June pension payment. For example, if the federal withholding on your June payment is $100.00 and the percent we used to calculate the 13th payment is 38%, the withholding on the 13th payment would be $38 ($100.00 multiplied by 38%).
Paid for by Employers
The 13th payment is paid for entirely by employer contributions. Each IMRF employer contributes .62% of its IMRF member payroll to pay for the 13th payment.