Wis. Stat. § 40.285 — WI Code / Chapter 40 / Section 40.285
Section 40.285
Status: in_force

1. The participant meets the requirements of this paragraph and submits an application to the board of regents of the University of Wisconsin System.

2. The board of regents of the University of Wisconsin System certifies the creditable service requested under subd. 1.

3. The participant pays to the department a lump sum equal to 5 percent of one-twelfth of the employee’s highest earnings in a single annual earnings period multiplied by the number of months of creditable service that is granted under this paragraph.

4. The employer does not pay any amount payable under this paragraph on behalf of any participating employee.

(f) Uncredited junior teaching service. Each participating employee whose creditable service terminates on or after May 11, 1990, and who submits to the department proof that the participant performed service in this state as a junior teacher, as defined in s. 42.20 (6) , 1955 stats., that was not credited under s. 42.40 , 1955 stats., shall receive creditable service for the period for which that service was performed, even if the participant did not become a member of the state teachers retirement system after performing that service, if all of the following occur:

1. The participant pays to the department a lump sum equal to 5 percent of one-twelfth of the employee’s highest earnings in a single annual earnings period multiplied by the number of months of creditable service that is granted under this paragraph.

2. The employer does not pay any amount payable under this paragraph on behalf of any participating employee.

(3) Application process.

(a) Provision of application forms and estimates. Upon request, the department shall provide a participating employee an application form for the purchase of creditable service under sub. (2) and shall also provide to the participating employee an estimate of the cost of purchasing the creditable service.

(b) Certification of plan-to-plan transfers. Upon request, the department shall provide a participating employee a transfer certification form for payments made by a plan-to-plan transfer under sub. (5) (b) . If the participating employee intends to make payments from more than one plan, the participating employee must submit to the department a separate transfer certification form for each plan from which moneys will be transferred.

(4) Payment.

(a) Required with application. Except as provided in par. (b) , the department may not accept an application for the purchase of creditable service without payment in full of the department’s estimated cost of creditable service accompanying the application. A participating employee may also do any of the following:

1. Use his or her accumulated after-tax additional contributions that are made under s. 40.05 (1) (a) 5. , including interest, to make payment.

2. Use his or her accumulated contributions, including interest, to a tax sheltered annuity under section 403 (b) of the Internal Revenue Code, to make payment, but only if the participating employee’s plan under section 403 (b) of the Internal Revenue Code authorizes the transfer.

(b) Alternate payment options. Notwithstanding par. (a) , the department may accept an application under this section without full payment if payment of at least 10 percent of the department’s estimate of the cost of the creditable service is included with the application, in the manner required under par. (a) , and the remaining balance is received by the department no later than 90 days after receipt of the application, in the form of a plan-to-plan transfer under sub. (5) (b) .

(c) Final cost calculation for purchase of creditable service. The department may audit any transaction to purchase creditable service under this subsection and make any necessary correction to the estimated cost of purchasing the creditable service to reflect the amount due under sub. (2) . Except as otherwise provided in sub. (7) , if the department determines that the final amount that is due is more than the amount paid to the department, the department shall notify the participant of the amount of the shortfall. If payment of the amount of the shortfall is not received by the department within 30 calendar days after the date on which the department sends notice to the participant, the department shall complete the creditable service purchase transaction by prorating the amount of creditable service that is purchased based on the payment amount actually received and shall notify the participant of the amount and category of service that is credited. The department, by rule, shall specify how a forfeited service purchase is prorated when the participant forfeited service under more than one category of employment under s. 40.23 (2m) (e) .

(d) Treatment of amounts to purchase creditable service. All amounts retained by the department for the purchase of creditable service under sub. (2) shall be credited and treated as employee required contributions for all purposes of the Wisconsin Retirement System, except as provided in ss. 40.23 (3) and 40.73 (1) (am) .

(5) Transfer of funds; plan-to-plan transfers.

(a) Transfer from certain benefit plans. Subject to any applicable limitations under the Internal Revenue Code, a participating employee may elect to use part or all of any of the following to purchase creditable service under this section:

1. Accumulated after-tax additional contributions, including interest, made under s. 40.05 (1) (a) 5.

2. Accumulated contributions treated by the department as contributions to a tax sheltered annuity under section 403 (b) of the Internal Revenue Code, but only if the employer sponsoring the annuity plan authorizes the transfer.

(b) Other plan-to-plan transfers. The department may also accept a plan to plan transfer from any of the following:

1. Accumulated contributions under a state deferred compensation plan under subch. VII .

2. The trustee of any plan qualified under sections 401 (a) or (k), 403 (b), or 457 of the Internal Revenue Code, but only if the purpose of the transfer is to purchase creditable service under this section.

(c) Payment shortfall. Except as otherwise provided in sub. (7) , if the department determines that the amount paid to the department to purchase creditable service under this subsection, together with the amount transferred under a plan-to-plan transfer, is less than the amount that is required to purchase the creditable service, the department shall notify the participant of the amount of the shortfall. If payment of the amount of the shortfall is not received by the department within 30 calendar days after the date on which the department sends notice to the participant, the department shall complete the creditable service purchase transaction by prorating the amount of creditable service that is purchased based on the payment amount actually received and shall notify the participant of the amount and category of service that is credited. The department, by rule, shall specify how a forfeited service purchase is prorated when the participant forfeited service under more than one category of employment under s. 40.23 (2m) (e) .

(6) Refunds. Except as provided in sub. (7) , if the department determines that the amount paid to the department to purchase creditable service, including any amount in a plan-to-plan transfer, is greater than the amount that is required to purchase the creditable service, as determined by the department, the department shall refund the difference. The department shall pay any refund to the participant, up to the amount received from the participant. Any remaining amount shall be returned to the applicable account in the trust fund for transfers under sub. (5) (a) or to the trustee of a plan which was the source of a plan-to-plan transfer under sub. (5) (b) . When more than one plan-to-plan transfer occurs, the department may determine which transfer is to be refunded, in whole or part. No funds transferred to the department by a plan-to-plan transfer may be refunded to a participant.

(7) Limit on payment of corrections. The department may not require a participant to pay any shortfall under sub. (4) (c) or (5) (c) that is $25 or less. The department may not pay any refund under sub. (6) if the amount of the refund is $25 or less.

History: 2003 a. 33 ss. 996 to 999 , 1025 ; 2003 a. 320 ; 2005 a. 154 ; 2013 a. 191 ; 2021 a. 245 .