Source: http://training.payroll.ucla.edu/edb/edb-e02-benefits-retirement.htm
Timestamp: 2018-07-17 05:42:47
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EDB Benefits Section E2, Retirement
E2.0 EDB BENEFITS - RETIREMENT
E2.1 Retirement Information Screen (ERET)
This screen is provided in reference to Sections 2 and 3 on the University-sponsored Retirement Plan and UC Retirement Savings Program - Defined Contribution, 403(b), 457(b) plans.
PPERET0-E1599                 EDB Entry/Update                07/18/YY 16:04:15
07/13/YY 23:41:35          Retirement Information             Userid:  ABCDE
ID: 121212121 Name: EXAMPLE,IMA                Emp Stat:  A     Pri Pay: MO
Retirement System Code: U     FICA Eligibility Code: E Ret FICA Derive: Y
Covered Comp Limit Cd : N     DCP Plan Code: S
DepCare Annual:  5000 Monthly:   416.67 Eff Date: 1231YY Term Date:
HCRA Annual   :   300 Monthly:          Eff Date: 1231YY Term Date:
HCRA Decl/YTD:     0.00/  300.00 403b Lmt: 14000    MAC Change: 01/01/YY
457b Lmt: 14000    MAC Change: 01/01/YY
Deduction Num    Description     Amount/Percent  Decl Balance       Eff Date
228        403B MTA $               2000.00                     0331YY
E2.2 Basic Retirement Plans
The University of California Retirement Plan (UCRP/the Pension Plan) provides retirement income for eligible employees and their beneficiaries. The Plan also provides disability and death benefits, a lump sum cashout, and for certain members the Capital Accumulation Provision (CAP).
UNIVERSITY OF CALIFORNIA RETIREMENT PLAN (UCRP) -- UCRP is the basic retirement plan under the University of California Retirement System. UCRP is a governmental defined benefit plan established and maintained under Internal Revenue Code (IRC) section 401(a). Benefits may be paid to an annuitant who is
(1) Vested (has a minimum of 5 years UCRP Service Credit) and
(2) Is at least 50 years of age.
Benefits are based on a three-part formula: the employees age, years of service, and highest average salary for a 36-month period.
UCRP has four classes of membership:
Benefits coordinated with Social Security -- for all employees hired after April 1, 1976 and those who elected Social Security coverage in 1976,
Benefits NOT coordinated with Social Security -- for those who elected in 1976 not to have Social Security coverage and those excluded from Social Security coverage by federal law. NOTE: The election not to coordinate with Social Security in 1976 is a permanent lifetime election, which also applies to employees who originally made this election, leave the University, and are later rehired,
Safety -- for those in Safety classifications (certain police and firefighter positions). Note: UCLA has employees in this class but UCOP does not, and
Tier Two -- for those who elected Tier Two prior to July 1, 1990. Tier Two was closed to new enrollments on July 1, 1990.
Defined Contribution Plan (DCP) -- A mandatory supplemental retirement plan which provides benefits based on amounts contributed on a pre-tax basis, plus or minus investment returns. Contribution amounts vary depending upon UCRP membership status:
With Social Security Without Social Security Safe Harbor
2% less $19 up to the OASDI maximum* and then 4% less $19 for the remainder of the calendar year. 3% less $19
*OASDI maximum for 2007 is $97,500
**Up to the OASDI maximum then zero deductions for the remainder of the calendar year
E2.3 Retirement System Code
This is a one-character system derived code that identifies the retirement plan (if any) of which the employee is a member. Eligibility for retirement plan membership is based on the type, percentage, and length of appointment.
U UCRP (University of California Retirement Plan – 1976 Tier) member -- includes members coordinated with Social Security and members who are not coordinated with Social Security)
W UCRP (University of California Retirement Plan – 2013 Tier) member - includes members coordinated with Social Security and members who are not coordinated with Social Security)
N Not eligible for UCRP membership
H Defined Contribution Plan -- Safe Harbor member, Not eligible for UCRP or OASDI membership
B UCRP Tier Two member with no required contributions to DCP (employees whose service credit x age factor > 100%) This category is not applicable to new employees.
P PERS (Public Employees Retirement System) member. Not applicable to new employees.
See Chart 2.A and Chart 2.C for Retirement System codes and eligibility requirements.
E2.4 FICA Eligibility Code
The Federal Insurance Contributory Act (FICA) requires eligible employees to pay Old Age Survivors Disability Insurance (OASDI) and/or Medicare taxes. FICA Eligibility is based on FICA employment tax regulations set by the Social Security Administration.
All employees are eligible for FICA with the exception of the following:
A non-resident alien for tax purposes who is in the U.S. on a J-1 or an F-1 visa.
A non-resident alien who lives and works outside of the U.S.
A student of the University of California who is registered in at least a half time course load.
An employee who elected not to pay OASDI in 1976 (may be subject to Medicare tax if rehired after 03/31/86).
An employee who is in a police title.
FICA has 2 components: (1) OASDI at a rate of 6.2%, and (2) Medicare at a rate of 1.45%. FICA eligibility may also be impacted by UCRP membership. Under the Safe Harbor Program, an employee who is eligible for FICA and is not a member of UCRP contributes to DCP SAFE HARBOR instead of paying OASDI. An employee in the Safe Harbor Program contributes 7.5% to DCP and pays a Medicare tax of 1.45%.
FICA Code Required to Pay:
E OASDI and Medicare taxes (UCRP member, used with Retirement code 'U')
M Medicare taxes only
N Not required to pay OASDI or Medicare taxes -- Applies to:
UCRP members who elected not to coordinate with FICA in 1976
Non-resident aliens with F-1 or J-1 visa status
Student employees enrolled at the University at least half time: 6 units or more.
See Chart 2.A and Chart 2.C for FICA System codes and eligibility requirements.
E2.4 (a) University Position NOT Eligible For FICA Taxes
The Social Security Protection Act of 2004, Section 419(c) of Public Law 108-203 requires that employers provide a written notice to any individual being hired on or after January 1, 2005 in a position that is NOT covered by Social Security.
As a result, all new hires in the following categories must complete and sign the 'Statement Concerning Your Employment in a University Position Not Covered by Social Security' UCRS 415 form no later than the beginning of the first day of work:
Safety personnel covered by the UC Retirement Plan for Safety Members (police and fire fighters)
Other UC Retirement Plan Members who are exempt from pay Social Security
Nonresident aliens living and working outside the U.S.
Nonresident aliens exempt from Social Security because of an F-1 or J-1 visa status
Nonresident aliens whose wages are subject to taxes or contributions under the Social Security system of a foreign country with which the U.S. has a totalization agreement
All Defined Contribution Plan Safe Harbor Employees
Part time, seasonal, and temporary employees who are not covered by Social Security
Non-exempt UC student employees who do not satisfy certain course load requirements
Employees who do not contribute to a retirement system who are not covered by Social Security
Exempt UC student employees who do satisfy certain course load requirements
Note: An employee must complete the form each time he or she is newly hired or rehired in a new appointment in one of the above categories.
E2.5 Defined Contribution Plan (DCP) Code
This is a one-character code 'Y or N,' that indicates eligibility for Defined Contribution Plan. This is a derived field and may not be changed manually.
E2.6 Retirement/FICA Derivation Indicator
This is a one-character code that identifies student employees whose retirement system code and FICA eligibility code should not be automatically derived or re-derived.
N - Retirement code and FICA code should NOT be automatically re-derived
Y - Retirement code and FICA code may be automatically re-derived
L - Retirement code and FICA code derivation is based on 1976 lifetime election not to coordinate with FICA
R - Retirement code for rehired retirees who accepted UCRP Waiver. Should be updated by Central Benefits offices only.
E2.7 Retirement and FICA Codes
The Retirement and FICA codes are separate fields, but they are often looked at together because eligibility is generally dependent upon the same appointment criteria (e.g., U/E and H/M).
E2.7(a) Retirement and FICA Codes for Student Employees
Eligibility for retirement and/or FICA membership for student employees is based on the employees student status AND course load. To verify and confirm that the Retirement and FICA codes are being derived appropriately, refer to Chart 2.A, and Chart 2.C.
The system will automatically re-derive these codes when the following fields are changed:
Visa Type Code
UC Student Status Code
Retirement/FICA Derivation Indicator
Addition or deletion of an appointment or a distribution
NOTE: DO NOT CHANGE FICA codes of "N" for those employees whose hire dates are prior to 4/1/86 unless there is a break in service. If an employee is rehired who originally opted out of Social Security, the FICA code should be an "M" unless the employee now meets the criteria for "N" coding (is on an F1/J1 visa or is a UC registered student with the required course load).
If you have any questions regarding FICA and/or Retirement codes, call your Central Benefits Office.
E2.8 Covered Compensation Limit (CCL) Code
This is a system-derived code which identifies the limits for UCRP Covered Compensation. These limits are determined by the IRS and may change annually as of July 1.
CCL Code UCRP Entry Date UCRP Covered Compensation
G Before 7-1-1994 $325,000
N 7-1-1994 or later $220,000
Note: Intercampus transfers and certain rehires should be coded 'G' if they have a UCRP entry date prior to 7/1/1994. Contact the Benefits Counselor for your department before assigning a code 'G.'
E2.9 Rehired Retirees
Retired employees may return to employment at UC with policy restrictions as shown here:
Emeriti without Salary return right away with NO limitations,
Other Faculty and staff may return after a 30-day break in service from the date of retirement if the pension or lump sum cash out check is received during the 30-day period, or a 90-day break if the pension/lump sum cash out check is delayed,
Re-employment is generally for an appointment of 46% or less,
If the rehired retiree returns to a position that makes them eligible for UCRP, they must notify Retirement Claims Administration in Oakland to discontinue their monthly retirement check. Employees MAY NOT earn UCRP service credit while receiving monthly UCRP payments.
E2.10 UCRP Waiver
All UC rehired-retirees should execute a signed Waiver, whether they accept or decline, when they return back to UC employment after retiring from the University of California Retirement Plan (UCRP). Regardless of the appointment and/or the hours they work, the Member should submit a properly executed Waiver. A new Waiver must also be executed whenever the member changes appointments and at anytime is subsequently rehired into a different position.
Even though many appointments for rehired-retirees are significantly less than 50%, service credit begins to accrue once the member works 1,000 hours in any 12-month period. Rehired-retirees, who return back to work almost immediately after retirement, would normally have accrued at least 1,000 hours of employment prior to retirement, thus would immediately continue to earn service credit in UCRP even though their rehired appointment is less than 50%.
If a Member accepts the Waiver, the appointment will be coded in payroll as such so the employee does not earn UCRP service credit nor contribute to "career" DCP. The Central Benefits Office will process these coding changes once the completed Waiver is received.
If the Member declines the Waiver, the Member should contact UC Retirement Administration immediately in writing so UCRP monthly benefits can be suspended.
What Happens if a UCRP Waiver is Accepted?
Continue to receive monthly UCRP pension checks
Continue appointment that ordinarily would be eligible for UCRP
If appointment is less than 43.75% (ineligible for benefits) employee may continue Annuitant Medical, Dental, & Legal (if eligible)
If appointment is for 43.75% or more, employee is required to enroll in Health Plans provided by active appointment and cancel annuitant health
Waive FUTURE UCRP service credit accruals
Forfeit Full Health & Welfare Benefits as active employee
What Happens if a UCRP Waiver is Declined?
Monthly Pension checks suspended
Annuitant benefits suspended
UCRP membership/service credit accrual reinstated
Subsequent retirement includes additional UCRP service credit earned during re-employment period. Health & Welfare Benefit eligibility is determined by their new active appointment
NOTE: The Waiver is irrevocable until a break in service.
How to obtain a copy of the Waiver
To obtain a blank Waiver contact the appropriate Central Benefits Office.
Where to send the completed Waiver
Upon having the employee complete and sign the waiver mail it to the appropriate Central Benefits Office.
E2.11 403(b) Limit
The Maximum Annual Contribution (MAC) is the dollar limit that an employee may contribute to the Tax-Deferred 403(b) Plan per calendar year. The maximum limit is the Tax Reform Act Limit. This amount will automatically be entered in the EDB. If, for some reason, the system does not automatically input the limit in EDB, contact the appropriate Central Benefits Office.
YEAR UNDER AGE 50 IF AGE 50 OR OVER BY END OF YEAR
E2.12 457(b) Limit
The Maximum Annual Contribution (MAC) for 457(b) plan is the dollar limit that an employee may contribute to the Tax-Deferred 457(b) Plan per calendar year. This amount will automatically be entered in the EDB. If, for some reason, the system does not automatically input the limit in EDB, contact the appropriate Central Benefits Office.
E2.13 Beneficiary Information
Beneficiary Designations for UCRP contributions (if applicable), CAP account (if applicable), University Paid/Supplemental Life Insurance and Accidental Death & Dismemberment Insurance plans should be entered on line at: http://atyourservice.ucop.edu, click on ‘Sign in to My Accounts’, log in to At Your Service Online and then click on ‘My Beneficiaries’. This information can be retrieved and changed by the employee anytime.
Employees, who are unable to use the online service, may use a form UBEN 116 or UBEN 117 if separated or retired. The forms can be downloaded at http://atyourservice.ucop.edu, click on ‘Forms and Publications’ under the Quick Link Menu.
For the UC Retirement Savings Program balances - Defined Contribution, 403(b) and 457(b) Plans, visit https://netbenefits.fidelity.com to input beneficiary information or call FITSCo at 866-682-7787 to request a beneficiary form.
CHART 2.A - RETIREMENT AND FICA CODING GUIDE
Retirement Code FICA Code UC Student Status* Title Percentage & Duration of Appointment and/or
1-Not registered
All except Visiting or Per Diem titles 50% or more for one year or more OR After 1,000 eligible benefit hours on pay status in a rolling 12-month period and minimum of 17.5 hours of average paid time per week
H** M** 1-Not registered Visiting or Per Diem Any percentage of time and duration
Less than 50% time OR less than a year
4-Grad Student (UCLA) Post MD or Post DDS Any percentage of time and duration
2-Not registered (UCLA degree candidate)
5-Not registered (degree candidate at another UC campus)
Student has not paid fees
3-Undergrad (UCLA)
6-Undergrad (at another UC campus)
Course load under 6 units
4-Grad Student (UCLA)
7-Graduate (at another UC campus)
Course load under 6 units (under 2 units during Summer Sessions)
N N 2-Not registered (UCLA degree candidate)
5-Not registered (degree candidate at another UC campus) 7
Student has paid fees (Student status 2 when fees are paid  coded as 4/88.8 in the EDB)
Course load is 6 units or more
Course load is 6 units or more (2 units or more during Summer Sessions)
* A student employee who is appointed at 100% for at least a year is considered a career employee. He/she is eligible to participate in the University of California Retirement Plan (UCRP) and is ineligible for the Student FICA exemption.
** NOTE: A Non-Resident Alien for Tax Purposes who has an F1/J1 visa and a Non-Resident Alien who is living and working outside of the US is coded N for Retirement and "N" for FICA. They are ineligible for Safe Harbor and exempt from FICA.
Refer to the Citizenship Codes Chart in Section B2 for information on visa types and citizenship codes.
CHART 2.C - SUMMARY OF RETIREMENT/FICA CODES & MEMBER CONTRIBUTIONS
FICA Codes Description DCP Contributions/
Contributions (a) OASDI Medicare Safe
(DCP-CAS)
U/E Coordinated with Social Security 2% less $19 per month 6.2% 1.45% N/A
U/E Coordinated with Social Security at OASDI maximum(b) 4% less $19 per month -0- 1.45% N/A
U/N Opted out of FICA in 1976 or Non-resident F1/J1 visa holder 3% less $19 per month -0- -0- N/A
U/N Safety member hired prior to 4/86 3% less $19 per month -0- -0- N/A
U/M Rehired after 4/86, opted out of Social Security in 1976 3% less $19 per month -0- 1.45% N/A
U/M Safety member hired after 4/86 3% less $19 per month -0- 1.45% N/A
H/M Hired between 7/91 and 10/19/92, or after 10/19/92 N/A -0- 1.45% 7.5%
H/N Hired prior to 4/86 N/A -0- -0- 7.5%
N/N Non-resident F1/J1 visa holder or UC registered student with required courseload and/or percentage and duration of time. N/A -0- -0- -0-
N/E Hired between 7/1 and 10/19/92 and opted into FICA on UPAY 758 N/A 6.2% 1.45% -0-
(a) UCRP contributions are currently being redirected to the Defined Contribution (DC) Plan.
(b) OASDI and DCP (Safe Harbor) deductions have maximum amounts per calendar year that can be deducted from an employee’s check. UCRP members have an increase in DCP deductions once the OASDI maximum is reached.