New regulations for those retiring with PERS or TRS benefits on or after Dec. 1, 2017

by Michelle Saport  |   

The State of Alaska Division of Retirement and Benefits has drafted new regulations that may affect retirees who retire on or after Dec. 1, 2017.  The proposed regulations address what constitutes a bona fide termination of employment, prohibition of pre-arranged return to work agreements and taxes or penalties that could be applied if it is determined the retiree did not truly terminate employment.

If you are planning to retire with PERS or TRS benefits, please visit the web site below regarding complete separation of employment, and restrictions on returning to work in any capacity after retirement. In short, the intent of the proposed regulations are as follows:

"Now, federal law similarly restricts re-employment into positions which are not covered by the retirement systems, such as temporary, nonpermanent positions or independent contractors if the positions are with the same employer from which the person retired. This policy is being adopted to protect the retirement systems and members by placing restrictions of retiree re-employment with the same employer into non-covered positions."

Read more here.

The draft regulations allow for a 30-day comment period. The university is preparing comment to submit within this notice period. After the comment period, the Division of Retirement will either adopt the proposed regulations or adopt modified regulations without further notice, or decide to take no action.

Departments should take advantage of this time to examine succession-planning methods for replacing key workers eligible for retirement before the effective date of the regulations.

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