The Legislative Session ended May 17 without a budget agreement. If a budget agreement is not reached by June 30, 2021, parts of state government will shutdown.
Since MSRS does not receive appropriations to pay its administrative expenses or monthly benefits, MSRS will remain open to answer any of your retirement related questions. July 1 pension payments will be processed at the end of June, and we have made arrangements to pay the August 1 and all future payments in the event of a lengthy shutdown.
Things to Know
MSRS will continue to process payments and be available to answer any questions regarding your retirement plan accounts.
Yes, but you must terminate state service and apply for your retirement benefit in order to start your benefit.
Important: If you return to state employment after cashing your first pension benefit payment, you can no longer contribute to MSRS and will be subject to an earnings restriction (currently $18,960). If your earnings exceed the earnings restriction, your monthly pension benefit will stop and be held in an account with MSRS until one year after your severance from employment or age 65, whichever is earlier. Learn More.
Generally, you will receive your first pension benefit payment approximately six weeks after the retirement date indicated on your application. The first payment amount is retroactive to your termination date.
Contact Us to change your retirement date. Keep in mind that you must contact your HR department and notify them of your new retirement date. MSRS requires a confirmed retirement date from your HR department prior to completing your first benefit payment.
Important: Changing your retirement date may have an impact on your monthly retirement benefit amount.
If you are unable to work because of a shutdown, it is considered a layoff and you are eligible to apply for a refund. The earliest refunds checks will be issued is August 11, 2021. If you return to work prior to your refund being processed, your refund application will be canceled.
Loans and partial refunds are not an option with your MSRS retirement plan. If you have more than one MSRS plan, you may choose to take a refund from just one of the plans.
Important: If you elect to apply for a refund, you will forfeit the employer contributions and all service credit for that period, unless you repay the refund plus 7.5% interest after returning to state service for at least six months.
A refund is subject to state and federal taxes. By law, MSRS is required to withhold 20% on your refund amount. In addition, if you are under age 59½, you may be subject to a 10% IRS tax penalty (paid when you file your income tax returns).
Learn more about refunds.
Possibly. Your future MSRS pension benefit is based on a formula that uses your high-five salary, your length of service and your age at retirement. The financial impact on your future pension benefit is dependent on the length of the shutdown, your salary, and your years of service.
If you are currently in your high-five salary period, your benefit may be impacted because you will not receive salary during the shutdown period. MSRS's high-five salary is based on the highest sixty, consecutive month period (five years). If the shutdown falls during this period, it could reduce the amount of your monthly benefit.
If you are a full time employee, you will receive service credit for the month of July. Employees receive full service credit for every month that they are paid 40 hours or more in at least one pay period ending during that month. In the event of shutdown on July 1, 2021, during the pay period ending July 6, full time employees will have 48 hours if they work June 23 through June 30; resulting in full service credit for July.
If you are age 59½ or older, you are eligible to take a withdrawal from your MNDCP account regardless of your employment status.
Login to your account online to request a withdrawal or Contact Us to request an In-Service Withdrawal Request form.
If you are under age 59 ½, you may be eligible for an unforeseen emergency withdrawal.
In the event of a shutdown, more information will be added to this page regarding unforeseen emergency withdrawals.
Please keep in mind that if you are paid salary for a partial pay period, your full salary deferral contribution will be deducted and deposited in your MNDCP account.
You may wish to consider changing your salary deferral contribution amount if there is a state government shutdown.
If you are laid off and have existing funds in your HCSP account, you may request reimbursement for expenses incurred during the period of shutdown/layoff. Expenses incurred prior to shutdown/layoff are not reimbursable.
Important: You cannot be reimbursed for the same expense from both your pre-tax medical dental account or Benny card and HCSP.