Tag Archives: ready-to-retire members

Overtime Limits for Tier 5 and 6 Members

The exact formula used in calculating your NYSLRS pension varies by tier and plan, but your credited service and final average salary (FAS) are the core variables. You earn service credit for paid service with participating employers and you also may claim it for some previous public service. FAS is the average wage you earned during the time period when your earnings were highest (36 consecutive months for Tier 5 and 60 consecutive months for Tier 6).

Your FAS can include overtime pay that you earned during the FAS period. However, for Tier 5 and 6 members, there are limits to how much overtime can be used to calculate your pension.

Members and employers aren’t required to make contributions on overtime pay above the limit, and your employer shouldn’t report overtime above the ceiling to us. While you can earn overtime beyond the limit, anything over will not count toward your FAS or your retirement benefit.

Tier 5 Overtime Limits

For Tier 5 Employees’ Retirement System (ERS) members, the limit changes each calendar year. The overtime ceiling for Tier 5 increases each calendar year by 3 percent. This year, the overtime ceiling for Tier 5 ERS members is $18,448.11. In 2018, it will be $19,001.55. For Police and Fire Retirement System (PFRS) members, the overtime limit is 15 percent of your regular earnings each calendar year.

Tier 5 & 6 Overtime Limits

Tier 6 Overtime Limits

For Tier 6 ERS members, the cap follows the fiscal year (April 1 through March 31), not the calendar year. For 2016-2017, the limit is $15,721. Come April that will increase to $16,048. The limit is adjusted for inflation based on the annual Consumer Price Index (CPI). The overtime ceiling for Tier 6 PFRS members is 15 percent of your regular earnings each calendar year.

Find more information about the overtime limit, FAS and retirement calculations in your plan booklet, available on our Publications page.

Your Checklist to Apply for Retirement

After months of planning and preparation, you’re ready to apply for retirement. To get your pension benefit, you need to send in a NYSLRS retirement application. Let’s look at what you should include with the form to help make the retirement process go more smoothly.

Filling Out the Retirement Application

Unless you’re filing for a disability retirement, you’ll need to fill out the Application for Service Retirement (RS6037). Some items to keep in mind when you fill out the form:

  • Know your registration number. You can find this number on your most recent Member Annual Statement or retirement estimate.
  • Know your past employment. Please list your public employment history, including military service and any memberships in other New York public retirement systems. This helps ensure you receive the proper credit for your public service.
  • Include your beneficiary’s information. This isn’t an official designation, but will help us provide you with the pension payment options available to you.
  • See a notary. The form must be filled out completely and signed by a notary public.

Applying for Retirement

Proof of Birth

Make sure we also have proof of your birth date. You can send it with your retirement application or before or after, but pension benefits cannot be paid without it. We’ll accept photocopies of the following as proof:

Other Forms to Consider

You’ll need to choose your payment option before your pension is payable. Option election forms are available on our website, but we will also send you a form after we process your retirement application. If you choose an option that would provide a pension benefit to a beneficiary upon your death, you must provide us with proof of your beneficiary’s birth date.

Your NYSLRS pension isn’t subject to New York State income tax, but it is subject to federal tax. You can fill out a W-4P form to tell us what amount you want withheld from your monthly benefit. You can change your federal withholding status at any time. We don’t withhold other states’ income taxes. Visit the Retired Public Employees Association’s website to see if your benefit will be taxed in another state.

You can enroll in our direct deposit program at the same time you file for retirement. Just fill out a Direct Deposit Enrollment Application (RS6370) and return it to us. Once your final retirement benefit amount is determined, your payments will be directly deposited into the account you specified on your enrollment application. Direct deposit is the fastest and most secure way for you to receive your pension benefits. We will send you information on your direct deposit payment amount including deductions, and will inform you when the amount changes.

If you’re divorced and your ex-spouse is entitled to part of your pension, you should send us a copy of your Domestic Relations Order (DRO) as soon as possible. We cannot finalize your pension until we have reviewed your DRO and calculated the required distribution of your benefit. The DRO gives us specific instructions on how your benefits should be divided. For more detailed information, please read our Guide to Domestic Relations Orders.

If you have other questions about applying for retirement, read our publication, Life Changes: How Do I Prepare to Retire?

The Top 10 Blog Posts of 2015

As 2015 comes to a close, let’s look at the top 10 blog posts you shared with friends this past year:

  1. NYSLRS – One Tier at a Time: ERS Tier 1

    A One Tier at a Time feature that looked at one of our smallest plans in the Employees’ Retirement System (ERS): Tier 1.

  2. NYSLRS Retirees: 1% COLA Payment Coming September 30

    An update for eligible NYSLRS retirees about the cost-of-living adjustment they’d receive in September 2015.

  3.  Keeping the Pension Fund Funded

    How NYSLRS plans ahead to maintain the funds it needs to pay current and future benefits.

  4. Protecting the Pension System

    How Comptroller Thomas P. DiNapoli defends NYSLRS against the abuse of public funds.

  5. NYSLRS – One Tier At a Time: PFRS Tier 1

    Tier 1 may be the smallest tier in the Police and Fire Retirement System (PFRS), but it was the third most popular One Tier at a Time post to share.

  6. The NYSLRS Member Annual Statement

    Each summer, we mail out approximately 700,000 Member Annual Statements filled with personalized benefit information you need to know.

  7. NYSLRS Basics: Understanding Your Final Average Salary

    A NYSLRS Basics feature that looks at what your final average salary is and the part it plays in your pension calculation.

  8.  NYSLRS Basics: Pension Payment Options

    Choosing how we’ll pay your retirement benefit is a big decision. Which payment option best meets your needs?

  9. NYSLRS Retirees Help Power New York’s Economy

    Comptroller DiNapoli spoke to a retiree group about how the pension money paid to retirees flows directly back into our communities, stimulating and growing our local economies.

    …and, the most shared post of 2015 is:

  10. NYSLRS – One Tier At a Time: ERS Tiers 3 & 4

    Our most shared blog post is also our first One Tier at a Time post, featuring Tiers 3 & 4 in ERS.

Thanks for sharing, and Happy New Year!