Texas Administrative Code › Title 34 - PUBLIC FINANCE › Part 3 - TEACHER RETIREMENT SYSTEM OF TEXAS › Chapter 25 - MEMBERSHIP CREDIT › Subchapter M - OPTIONAL RETIREMENT PROGRAM › Section 25.173 - Correction of Ineligible Participation in TRS

Current through Reg. 49, No. 28; July 12, 2024
(a) Except as provided in subsection (e) of
				  this section, a person who elected to participate in ORP and participated in
				  ORP for at least one year and who was reported to TRS in error as described in
				  §
										830.108,
				  Government Code, must be restored to participation in ORP and may not receive a
				  distribution of benefits from TRS based on the ineligible
				  participation.
(b) Each employer
				  that reported the person in error to TRS must, within 30 calendar days of
				  receiving the request from TRS, certify on a form prescribed by TRS that the
				  person was reported in error to TRS; the amount of the person's compensation
				  that was creditable for ORP purposes and the amount of participant
				  contributions that should have been contributed to ORP for each school year
				  that the person was employed by that employer and reported in error to TRS; and
				  the amount, if any, of employer contributions made to TRS under §§
										825.4041,
				  825.406,
				  825.407,
				  or
				  825.4071,
				  Government Code, based on the employment of the person reported to TRS in
				  error.
(c) The person reported to
				  TRS in error must provide information required by TRS to make a direct
				  trustee-to-trustee transfer to the trustee of the person's ORP plan account of
				  authorized amounts and complete any forms prescribed and required by TRS to
				  make the direct trustee-to-trustee transfer of funds, including the agreement
				  of the trustee of the person's ORP plan account to accept the transfer in
				  accordance with §
										830.108(d)(2)(B),
				  Government Code. The trustee must also agree to separately account for any
				  after-tax funds that are part of the direct trustee-to-trustee transfer.
				  Authorized amounts include the amount of participant contributions that should
				  have been made to ORP plus an amount representing earnings authorized by
				  §830.108. If the amount of ineligible member contributions received by TRS
				  is less than the amount of participant contributions that should have been made
				  to ORP, then TRS may only make a direct trustee-to-trustee transfer of an
				  amount equal to the amount of ineligible TRS member contributions plus
				  authorized earnings. TRS may not pay or transfer any amount of required ORP
				  participant contributions that exceed the amount of ineligible member
				  contributions received by TRS.
(d)
				  Each employer that reported the person in error to TRS and that made employer
				  contributions in error to TRS under §§
										825.4041,
				  825.406,
				  825.407,
				  or
				  825.4071,
				  Government Code, must provide the certification required in subsection (b) and
				  receive the approval of TRS before taking a credit for the employer
				  contributions through the TRS employer reporting system. Earnings on the
				  employer contributions paid in error to TRS are not authorized for payment by
				  TRS and may not be taken as a credit through the employer reporting
				  system.
(e) If within 180 days of
				  notice by TRS of the reporting error, the person does not have or cannot
				  establish an ORP account; cannot obtain the required certification from the
				  employer(s) that reported the person in error to TRS; cannot obtain the
				  approval of the trustee of the person's ORP plan account to receive the direct
				  trustee-to-trustee transfer of funds from TRS; or does not provide the forms
				  required for TRS to make the direct trustee-to-trustee transfer of funds to the
				  person's ORP plan account, TRS is authorized to pay directly to the person
				  reported in error to TRS the ineligible TRS member contributions equal to the
				  amount of ORP member contributions received by TRS that should have been
				  contributed to ORP plus the amount representing earnings on amounts authorized
				  by §830.108.
(f) TRS must make
				  a direct payment to the person of the amount of ineligible TRS member
				  contributions deposited in error with TRS that exceed the amount of ORP
				  participant contributions that should have been paid to the person's ORP
				  account and any amounts paid by the person to purchase TRS service credit while
				  ineligible to participate in TRS. The amount of direct payment to the person
				  reported in error to TRS under this subsection does not include earnings that
				  are authorized on amounts transferred to the person's ORP account by
				  §830.108 or paid directly to the person pursuant to subsection
				  (e).
(g) An employer of a person
				  who elected ORP but was reported in error to TRS may not take a credit through
				  the TRS employer reporting system of any member or employer contributions
				  authorized in §830.108(c)(2) without the knowledge and express approval of
				  TRS.