Retirement - MPSERS Tax-Deferred Service Credit Purchase

Summary

Under this program, participating employers will, at the request of an employee who is a member of Michigan Public School Employees Retirement System (MPSERS), be able to deduct tax-deferred amounts from the employee's pay for service credit purchased and the repayment of refunds.

Procedures

1. 1. The eligible employee and employer must enter into a binding and irrevocable Tax Deferred Payment Agreement (TDP).
   2. Once the reporting unit and the employee have completed the TDP Authorization Form, payments must continue every payroll until the service credit purchase or purchase of a repayment is paid in full, or the employee terminates employment with the reporting unit.
   3. TDP payments cannot be reduced or postponed because of financial hardship or other reasons.
   4. If you are interested in purchasing service credit or repaying a refund, the following steps need to be followed:
      1. Contact the Office of Retirement Services (ORS) to obtain a Member Billing Statement and TDP Authorization Form at 1-800-381-5111.
      2. Return the completed TDP Authorization form and Member Billing Statement to the Human Resources Office.  The Agreement/Payroll Authorization Form will be sent to ORS for review and approval.
      3. After approval, Delta College will begin payroll deducting the amount set by the employee on a biweekly basis for the length of the contract agreement.
         1. The minimum payroll deduction amount for an employee will be indicated on the Billing Statement.
         2. The maximum allowable payroll deduction is the employee's gross reportable compensation per pay period, less Social Security, Medicare, and Member Investment Plan (MIP) deductions, per agreement.
         3. The maximum annual pre-tax withholding for an employee is the lesser of:
            ¤  the amount eligible to purchase
            ¤  the employee's current gross reportable compensation
   5. An employee may have only one Tax Deferred Payment Plan at a time for the same type of service purchase.  For out-of-system or nonpublic service purchase types, the employee can request that several work locations be combined into one billing statement for each type available.
   6. For more information on the Tax Deferred Payment Program, check out the Retirement System's web site at: Michigan Office of Retirement Services .
   7. If you wish to purchase Universal Buy-in Time, call ORS toll free at 1-800-381-5111 or at 517-322-5103 in the Lansing area, to request a billing statement.

Participation
All full-time regular and part-time regular employees can participate in the Tax Deferred Payment Program (TDP) through ORS.

Revision/review dates
6/16