Nebraska Administrative Code › Topic - PUBLIC EMPLOYEES RETIREMENT SYSTEMS › Title 303 - PUBLIC EMPLOYEES RETIREMENT BOARD › Chapter 15 - PURCHASE OF SERVICE CREDIT › Section 303-15-007 - Payment Methods

Current through June 17, 2024
007.01 Installment Method
007.01(a) Members electing to purchase
				optional service credit with the installment method may choose tax deferred
				payroll deduction or direct after-tax installment payments. Payments made are
				subject to IRS code section 415 annual limits. If the contributions qualify as
				a repayment of original mandatory contributions as described under section 002
				of this regulation the section 415 limits do not apply.
007.01(b) Before direct after-tax installment
				payments can be accepted for purchase of service each year during the
				installment period, the member must substantiate his or her current
				compensation in such manner as may be required by NPERS. If a member's direct
				after-tax installment payments exceed the applicable code section 415 limit,
				the excess shall be refunded to the employee and the service credit adjusted
				accordingly.
007.01(c) Direct after
				tax installment payments made to NPERS by the member must be by cashier's
				check, bank draft or money order. Personal checks will not be accepted except
				for de minimus amounts in order to meet a purchase cost.
007.01(d) A member may elect to purchase
				service through payroll deduction pursuant to an irrevocable payroll deduction
				agreement with the member's employer that authorizes the employer to deduct the
				payment from the employee's compensation. One copy of the agreement must be on
				file with the employer and one copy with NPERS before payments may begin. In
				the event a member elects to purchase service by payroll deduction, the covered
				employer shall be responsible for making timely remittances of the member's
				contributions for his or her service purchases.
007.01(e) Notwithstanding anything to the
				contrary in this Chapter 15, NPERS will accept payments made via payroll
				deduction after the member's last working day, through and including the
				member's final paycheck, if the members employment contract calls for part of
				the member's compensation to be paid in arrears after the member's last working
				day.
007.01(f) In the event a
				member's irrevocable purchase agreement becomes inoperative due to the
				employee's death, disability, or other termination of employment before full
				payment for the employee's service purchase has been completed, no further
				contributions for the purchase of creditable service shall be accepted and the
				employee's retirement benefit under the applicable retirement system shall be
				computed with service credit equal to the amount of service credit acquired in
				proportion to the amount of the installment payments paid by the member under
				the irrevocable purchase agreement.
007.01(g) In the case of the School Employees
				Retirement System, termination of employment for the employee does not include
				ceasing work at one school district and then providing successive contributory
				service at another school district that participates in the School Employees
				Retirement System. If the employee transfers to another school district
				administered by the Retirement Board, then the employee shall continue, without
				interruption, direct after tax 6. monthly installment payments or monthly
				payroll deductions, whichever was specified in the member's irrevocable
				purchase agreement. In the case of payroll deductions, upon notification by the
				member, NPERS will contact the successor employer in order to make arrangements
				to continue, without interruption, monthly payroll deductions specified in the
				originating irrevocable purchase agreement.
007.01(h) The finance interest rate used for
				the direct after tax installment payments and tax deferred payroll deductions
				shall be the actuarial interest rate assumption based on the expected long-term
				rate of return for each plan, recommended by the state's actuary and adopted by
				the Retirement Board.
007.01(i) A
				late fee may be charged when direct payments are not received by the payment
				deadline. The fee will be based on the finance interest rate as defined by this
				section.