TMRS_Facts_2014TMRSFACTS
Texas Municipal Retirement System
A brief overview of your retirement plan
Table of Contents
What Is TMRS? ________________________________1
How Does TMRS Work? _________________________2
How Do I Keep Up with My Account?_______________4
How Do I Contact TMRS? ________________________5
What if I Die Before I Retire? _____________________6
What if I Leave City Employment? _________________6
What Happens When I Retire? ____________________7
Proportionate Retirement Systems ________________8
Copyright 2014, Texas Municipal Retirement System.
This booklet is an informal presentation of information about TMRS and related issues. If any
specific questions of fact or law should arise, the statutes will govern. TMRS, MyTMRS, and
the TMRS logo are registered trademarks of the Texas Municipal Retirement System.
1TMRS FACTS
What Is TMRS?
The Texas Municipal Retirement System (TMRS®) is the retirement
program your city has chosen for its employees. TMRS administers
a retirement plan for municipal employees that is funded by the con-
tributions of its members, its member cities, and earnings from in-
vestment of those deposits. Under TMRS, each city chooses from a
menu of retirement provisions to provide affordable, sound benefits
for their employees and families. As a member of TMRS, if you meet
the eligibility requirements and retire with the system, you will re-
ceive a retirement annuity for as long as you live.
Membership Requirement
Contributing monthly to your individual TMRS retirement account is
a requirement if you are an eligible employee of a city that partici-
pates in the TMRS plan. All employees who are regularly engaged in
a position that normally requires more than 1,000 hours per year at a
TMRS-participating city must be enrolled in the program.
How Are We Different from Other Systems?
Most public employee retirement systems provide a benefit based
on a multiplier times your years of service and salary. In TMRS, your
benefit is based on the actual dollars you and your city contribute,
the investment earnings made on those contributions, and other fac-
tors and credits that may be adopted by your city. In 2009, the TMRS
Act was amended to guarantee a minimum annual 5% interest credit
to member accounts.
TMRS FACTS
2 TMRS FACTS
How Does TMRS Work?
Your Retirement Account
A percentage of your gross compensation is deducted each pay
period and deposited into your individual account. The percentage
deducted — either 5, 6, or 7% — depends on the plan provision your
city has adopted (see the “My City Plan” sheet or go to Member
Services/City Plan Provisions at www.tmrs.com). Your monthly TMRS
deposit is deducted before income taxes are withheld, and you do
not pay taxes on those deposits until you refund or retire.
Once your monthly deposit is received, TMRS invests the money,
and your account earns interest credits each year. The more you
work, the more you put into the system, the more you will get back
at retirement. Under the law that governs the system, you cannot
borrow from your retirement account.
City Matching
Each city chooses to match employee deposits at a ratio of 1 to 1, 1.5
to 1, or 2 to 1 (see “My City Plan” or Members/City Plan Provisions for
your city’s matching ratio). When you retire, the city’s contributions
are combined with your deposits and interest credits, and the com-
bined total is used to pay your monthly retirement benefit.
You only receive the city’s matching funds in the form of a monthly
payment when you retire.
If at any time you leave city service and choose to receive your de-
posits and interest, you will not receive the city’s matching funds.
Service Credit
Generally, you earn a month of service credit toward retirement
for each month you make a deposit while employed in an eligible
position. Depending on your city’s plan, you may establish other
types of service credit, including credit for previous employment or
active duty military service.
Beneficiaries
Your beneficiary is the person or persons you choose to receive any
retirement benefit due upon your death. TMRS will ask you to name
a beneficiary when you first become a TMRS member, when you
vest (after 5 or 10 years of service), and when you retire. When you
vest, it is very important to fill out a vested beneficiary form.
3TMRS FACTS
Vesting/Retirement Eligibility
When you have 5 years of service credit (10 in some cities), you are
“vested” in the system. As a vested member, if you leave TMRS-
covered employment, you may leave your deposits with TMRS. Your
deposits will continue to earn interest credits until you withdraw
them or retire.
You will be eligible to retire when you meet either of these qualifica-
tions, depending on your city’s plan:
●●You are age 60 with 5 or 10 years of service credit, or
●●You have 20 or 25 years of service credit at any age.
See “My City Plan” or City Plan Provisions for your city’s retirement
eligibility requirement.
Service credit with other statewide retirement systems or government
entities may also count toward your eligibility for service retirement.
The service history shown on your Annual Statement (see page 4)
reflects any service credit with other TMRS cities, plus any buybacks,
military service credit, or restricted prior service credit you have received.
Proportionate Retirement
TMRS participates in the Proportionate Retirement Program. This
program allows you to combine service credit from specific Texas re-
tirement systems to meet service retirement eligibility requirements.
With combined service, you may be able to retire earlier.
The systems that participate in this program with TMRS are: Employ-
ees Retirement System of Texas, Teacher Retirement System of Tex-
as, Judicial Retirement System of Texas, Texas County and District
Retirement System, and the City of Austin Employees Retirement
System (see page 8 for contact information).
Updated Service Credit
Updated Service Credit (USC) is an optional feature that updates
your TMRS benefit to take into account changes in your salary or in
your city’s TMRS plan. USC helps your retirement benefit retain its
value over your career. See “My City Plan” or City Plan Provisions to
determine if your city offers Updated Service Credit.
4 TMRS FACTS
How Do I Keep Up with My Account?
Annual Statements
A TMRS Annual Statement is mailed to the home address we have on
file for you every spring. This statement includes your service history,
your beneficiary information, retirement estimates, your total member
deposits, and the past year’s interest credit. Keeping your personal
information (such as mailing address and beneficiary) up-to-date
is extremely important. The Annual Statement gives you a chance to
review the information TMRS has on file for you.
MyTMRS®
The TMRS website (www.tmrs.com) provides secure online access
to your account information. Use the MyTMRS feature of the website
to see your account statements, check your year-to-date totals, and
run retirement estimates. You must register for this service before you
can use it. You may register online, set up your password, and access
MyTMRS using security questions and your e-mail address; a verifica-
tion e-mail will be sent to you.
Retirement Estimates
You may run retirement estimates through MyTMRS. These estimates
show approximately how much money you will receive in your monthly
retirement benefit for each of the available retirement options. To com-
pare your annuity amounts, we encourage you to run as many estimates
for as many retirement dates as you wish.
For More Details…
For a complete description of your TMRS benefits, see the Member
Benefits Guide (available in English and Spanish) or the “How Do I…”
tutorials on the TMRS website Member Services menu.
5TMRS FACTS
How Do I Contact TMRS?
Se habla español.
Phone Center
800.924.8677 • Toll free
512.476.7577 • Local
512.476.5576 • Fax
E-mail
phonecenter@tmrs.com
Website
www.tmrs.com
Mailing Address
P.O. Box 149153
Austin, Texas 78714-9153
Headquarters Building
1200 North Interstate 35
Austin, Texas 78701
How Do I Review or Change My Account?
* Account identifiers are personal details known to the member only.
Y
.
8
2
By phone – include 2 account identifiers.*
In writing – by letter or fax;
include signature and 2 account identifiers.
Web – use www.mytmrs.com with password.
Form – needs specific form with signature;
forms are available through the Phone Center,
website, or your personnel office.
Account balance
Address or name change
Beneficiary info
Change beneficiary
Credited service
Request for statement
Request for statement
to different address
Retirement estimate
2
Y .8
Y
Y 8
8.
.
.
.
2
Y
8
8.
6 TMRS FACTS
What if I Die Before I Retire?
Death Benefits
If you die before you retire, benefits will be paid to your chosen
beneficiary. If you do not properly designate a beneficiary, the TMRS
statutes will govern who will receive your benefits. If you were vested
in TMRS at the time of your death, your beneficiary can immediately
begin to receive a monthly payment. If your spouse is your benefi-
ciary, he or she may choose to leave your deposits in the system
until you would have turned age 60 — and then receive a lifetime
monthly benefit payment. If you are not vested, your beneficiary or
estate will receive a refund of your accumulated deposits and inter-
est. It is extremely important to keep your beneficiary information
correct, particularly after you are vested.
Supplemental Death Benefit
Some cities have adopted a Supplemental Death Benefit (see “My
City Plan” or City Plan Provisions). If your city has chosen this addi-
tional benefit and you die while employed by the city, your benefi-
ciary will also receive a payment approximately equal to your cur-
rent annual salary; this benefit applies to both vested and nonvested
members. You may designate different beneficiaries for your regular
retirement benefit and your Supplemental Death Benefit.
What if I Leave City Employment?
Refund vs. Retirement
If you are vested at the time you leave the city, you can leave your
accumulated deposits, which continue to receive interest credits, in
TMRS until you decide to retire. If you are not vested, then you may
only leave your deposits for up to five years. After five years, you
must either refund your deposits and interest or roll them over di-
rectly into an IRA or another qualified plan. Remember, if you refund
your deposits, you will not receive the city’s matching money.
Taxes and Penalties
If you are not vested, you may decide to refund or transfer your funds
to an IRA or other qualified plan when you leave employment with all
TMRS cities. If you refund your member deposits and interest, a 20%
tax withholding and a 10% tax penalty may apply. See the Special
Tax Notice (TMRS website, Forms page) for details on withholding,
early withdrawals, and rollovers to IRAs or qualified plans.
7TMRS FACTS
NOTE: Federal tax law permits public safety employees who end employment at age
50 or later (and receive a refund or lump-sum payment) to waive the 10% IRS penalty.
The city will need to certify the employee’s status as a public safety employee on form
TMRS-PSE for this penalty to be waived.
What Happens When I Retire?
Choosing a Retirement Option
When you become eligible for and apply for retirement, you may
select one of these benefit payment plans:
●●Retiree Life Only Option — a monthly payment for the rest of your
life, with no survivor benefits.
●●Lifetime Survivor Options — a benefit for the rest of your life and a
lifetime benefit for your designated survivor at 100%, 75%, or 50%
of your monthly retirement benefit. If your beneficiary dies before
you, your benefit will “pop up” to a Retiree Life Only Option.
●●Guaranteed Term Options — a lifetime benefit for you and a sur-
vivor benefit paid for the remainder of a guaranteed term (5, 10, or
15 years) if you die before the guaranteed term expires. The term
starts at your retirement.
Partial Lump Sum Distributions
At retirement you may choose to receive part of your benefit as a
Partial Lump Sum Distribution (PLSD). This amount may equal 12, 24,
or 36 times your monthly benefit under the Retiree Life Only Option
(not to exceed 75% of your member deposits and interest). A PLSD
is subject to income tax; see the Special Tax Notice (Forms page of
the TMRS website) for details on withholding, early withdrawals, and
rollovers to IRAs or qualified plans.
Annuity Increases (COLAs)
Your city may choose to grant a Cost of Living Adjustment (COLA)
to its retirees. COLAs may be granted annually and are based on
changes in the Consumer Price Index. If your city has adopted this
option (check “My City Plan” or City Plan Provisions), you must be
retired for a full year to be eligible for a COLA.
Death Benefits after Retirement
Your beneficiary will continue to receive a monthly benefit if you have
chosen a retirement option that provides a survivor benefit. A Supple-
mental Death Benefit of $7,500 will be paid upon your death to your
beneficiary if the city from which you retired offers this coverage.
8 TMRS FACTS
City of Austin Employees Retirement System
1.512.458.2551
www.coaers.org
Employees Retirement System of Texas
1.877.275.4377 (toll-free)
www.ers.state.tx.us
Judicial Retirement System of Texas
(Plan I or Plan II)
1.877.275.4377 (toll-free)
www.ers.state.tx.us
Teacher Retirement System of Texas
1.800.223.8778 (toll-free)
www.trs.state.tx.us
Texas County and District Retirement System
1.800.823.7782 (toll-free)
www.tcdrs.org
Proportionate Retirement Systems
(participating with TMRS)
9TMRS FACTS
®
P.O. Box 149153
Austin, Texas 78714-9153
1200 North Interstate 35
Austin, Texas 78701
800.924.8677
www.tmrs.com