Arkansas Administrative Code › Agency 088 - Arkansas Teacher Retirement System › Rule 088.00.08-002 - Rules No. 7-3: Reporting Member Contributions; No. 7-4: Employer Contributions; No. 8-2: Refunds of Member Contributions; No. 8-18: Purchase of Domestic Federal Service; No. 8-19: Purchase of Federal Retirement Service; No. 10-2: Retirant's Return to Covered Service

Current through Register Vol. 49, No. 6, June, 2024
DEFINITIONS
(Amended by Act 638 of 1995, Act 11 of
			 1999, and 146 of 2005)
1.
Salary
means any remuneration paid an employee in a position or
		  positions covered by the System and on which the employer withholds federal
		  income tax. It includes remuneration received from all covered employers during
		  a school fiscal year; however, compensation in excess of the limitations set
		  forth in Section 401(a)(17) of the Internal Revenue Code shall be disregarded.
		  The limitations on compensation for "eligible employees" shall not be less than
		  the amount allowed under the System in effect on July 1, 1993. For this
		  purpose, an "eligible employee" is an individual who was a member of the System
		  before the first plan year beginning after December 31, 1995.
2.
Covered salary
means,
		  effective July 1, 2003, employees' regular and federal salaries for the current
		  fiscal year plus supplemental salary payments received for the previous fiscal
		  year, plus adjustments agreed upon by both the employer and the Teacher
		  Retirement System. For each member who first became a member before July 1,
		  1971, the covered salary for each year after June 30, 1969, is the first
		  $7,800.00 of the member's total annual salary for all covered employment
		  (Salary Option 2) unless he/she has elected to make contributions to the System
		  on full salary. For each member who first became a member after June 30, 1971,
		  or has elected to make contributions on full salary, the covered salary is his
		  or her full salary for all covered employment (Salary Option 1). If, however, a
		  member making contributions only on the first $7,800.00 of total annual salary
		  (Salary Option 2) receives a refund of contributions and subsequently returns
		  to covered service as a noncontributory member, he or she shall be considered
		  on full salary for reporting purposes (Salary Option 1).
3.
Covered Employer
means each
		  employer for whom a member renders service in a covered position.
RULES
(Amended by Act 638 of 1995, Act 206 of 1997,
			 and Act 11 of 1999)
1. After June 30,
		  1997, each employer will pay the member contributions for each salary earned by
		  contributory members, and those contributions will then be treated as employer
		  contributions in determining tax treatment under the provisions of the federal
		  Internal Revenue Code and the Arkansas Income Tax Act. The contributions will
		  not be included as gross income of the member until they are distributed or
		  made available to the member. The employer will pay these member contributions
		  from the same source of funds used in paying the salary to the member. The
		  employer may pay these contributions by a reduction in the cash salary of the
		  member, or by a setoff against future salary increases, or by a combination of
		  a reduction in salary and a setoff against future salary increases. If member
		  contributions are paid by the employer as provided under this subsection, they
		  shall be treated for all purposes of the Teacher Retirement System in the same
		  manner and to the same extent possible as member contributions made prior to
		  the date the employer began payment of the member's contributions as
		  described.
2. Each employer shall
		  deduct the member contributions from the salary of each contributory member on
		  each payroll from the date of entrance into the System until retirement, and
		  the employer shall remit the contributions to the System; however, compensation
		  in excess of the limitations set forth in Section 401(a)(17) of the Internal
		  Revenue Code shall be disregarded. The limitation on compensation for "eligible
		  employees" shall not be less than the amount allowed by the System in effect on
		  July 1, 1993. For this purpose, an "eligible employee" is an individual who was
		  a member of the System before the first plan year beginning after December 31,
		  1995.
3. In order that each member
		  of the Teacher Retirement System may receive credit for days of service,
		  covered salary, and contributions on a timely basis, each employer shall report
		  employee and employer contributions to the System on the following schedule:
Monthly Contribution Reports
Date Due:
Fifteenth
			 (15th) calendar day of each month. To avoid the late
			 report penalties (see Nos. 6 and 7 on page 7-4-3), reports must be received by
			 the 15th day of the month or must be postmarked by
			 the 14th day of the month due. If the
			 14th falls on Saturday, Sunday, or a holiday, the
			 postmarked date is extended to the next working day.
Quarterly Retirement Reports
Date Due:
Fifteenth
			 (15th) calendar day of each quarter. To avoid the
			 late report penalties (see Nos. 6 and 7 page 7-4-3), reports must be received
			 by the 15th day of the month or must be postmarked
			 by the 14th day of the month due. If the
			 14th falls on Saturday, Sunday, or a holiday, the
			 postmarked date is extended to the next working day.
4. Each of the above reports must be on forms
		  or electronic media either furnished by the Teacher Retirement System or
		  approved by the System.
5.
		  Overpayments or underpayments of member contributions reported from the local
		  level shall be handled in the following manner by the ATRS office:
A. If an underpayment of less than $25.00 was
		  reported from the local level, no attempt will be made to collect the
		  difference of this underpayment.
B.
		  If an overpayment of contributions of less than $5.00 is reported from the
		  local level, no refund of this amount will be made to the member, except upon
		  written request from the member. The total amount reported by the employing
		  authority shall be credited to contributions.
C. Should an underpayment of contributions
		  occur as a result of a member's changing status from noncontributory to
		  contributory, the member must remit to the System the contributions due based
		  on gross salary earned retroactive to July 1 of that fiscal year. Service
		  credit will be granted upon completion of contribution and applicable interest
		  payments for that fiscal year.
D.
		  Should an overpayment of member contributions occur as a result of changing
		  status from contributory to noncontributory, the System will refund the
		  overpayment of member contributions to the employer.