Texas Administrative Code › Title 34 - PUBLIC FINANCE › Part 3 - TEACHER RETIREMENT SYSTEM OF TEXAS › Chapter 25 - MEMBERSHIP CREDIT › Subchapter B - COMPENSATION › Section 25.30 - Conversion of Noncreditable Compensation to Salary

Current through Reg. 49, No. 28; July 12, 2024
(a) For members who on or before August 31,
				  2005 had attained the age of 50, had at least 25 years of service credit, or
				  whose combined age and service credit equaled 70 or greater, TRS excludes from
				  creditable compensation any amount of otherwise eligible compensation that
				  represents amounts converted into salary and wages from noncreditable
				  compensation to be received in any of the last three school years prior to
				  retirement. Amounts excluded under this subsection are excluded in the year of
				  conversion and each subsequent year until retirement.
(b) For members who on or before August 31,
				  2005 did not meet the requirements of subsection (a) of this section, TRS
				  excludes from creditable compensation any amount of otherwise eligible
				  compensation that represents amounts converted into salary and wages from
				  noncreditable compensation to be received in any of the last five school years
				  prior to retirement. Amounts excluded under this subsection are excluded in the
				  year of conversion and each subsequent year until retirement.
(c) For purposes of this section, conversion
				  occurs when an employer agrees to pay a member with creditable compensation for
				  services performed in the future that in the past were paid by that employer
				  with noncreditable compensation. Compensation in the form of accrued paid leave
				  or accrued compensatory time for overtime worked cannot be converted to
				  eligible compensation and is expressly excluded from creditable compensation at
				  any time.
(d) The employer
				  certifies whether compensation was converted in the last three school years
				  prior to retirement for those members meeting the requirements of subsection
				  (a) of this section and whether compensation was converted in the last five
				  school years prior to retirement for those members who do not meet the
				  requirements of subsection (a) of this section.
(e) Only compensation converted after the
				  2005-2006 school or contract year will be excluded under this
				  section.
(f) TRS will adjust a
				  member's annual compensation at the time of retirement to comply with the
				  requirements of subsection (a) of this section and refund the member
				  contributions on excluded amounts. The refund will be made after the date on
				  which TRS makes the first annuity payment.
(g) If compensation is excluded under
				  subsection (a) or (b) of this section, the member may provide additional
				  information in the form of written documentation to demonstrate that the
				  compensation should not be excluded. TRS makes the final determination
				  regarding the characterization of compensation as creditable or
				  noncreditable.
(h) Upon the request
				  of TRS, the employer shall provide documents or records evidencing
				  characterization of the compensation.