Section 6 - IMRF

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Member Accounts / Past Service / Employer Resolutions / SECTION 6 Illinois Municipal Retirement Fund such as, two years, three years, five years, or it may be unlimited. However, the member may not use the service in the computation of a pension or retirement pay from the U.S. government. 6.60 C. To Allow Service Credit for Military Service PRIOR to IMRF Participation OR for Members Who Do Not Return to IMRF Participation within 90 Days (Form 63A, Exhibit 6EE) Governmental units may elect to allow IMRF service credit to members who served in the armed forces of the United States prior to their participation in IMRF or whose participation was interrupted by military leave but did not return to IMRF participation within 90 days of discharge. Under this resolution, the service credit cannot be limited to a specific IMRF member and applies to all employees who were in active participating status under IMRF on the date this resolution was adopted. Eligible members may purchase up to four years of service. Public Act 95-0486 increased the number of years of military service an IMRF member can convert to IMRF service credit from two years to four. An employer’s governing body is not required to pass a new resolution (IMRF Form 63A) increasing the eligible military service to four years. If the employer’s governing body previously adopted a resolution (IMRF Form 6.63) making its IMRF members eligible to convert two years of military service, its members remain eligible to convert up to two years of military service to IMRF service. If the employer wants to increase the amount of military service its members can convert to IMRF service from two years to four years, it would need to pass a new resolution (IMRF Form 63A). If the employer’s governing body never adopted a resolution but wishes to do so now, it would adopt IMRF Form 63A. Its IMRF members would be eligible to convert up to four years of military service to IMRF service. If desired, an employer can revoke the authorizing resolution at a later date. Employers may also pass the authorizing resolution again at a later date. There is no limit on the number of times an employer may pass and revoke this resolution. 6.60 D. Relating to Participation by Elected Officials in IMRF (Form 6.64, Exhibit 6FF) Elected officials (and city hospital workers) have the option of participating in IMRF. For an elected official to participate in IMRF, his or her governing body must submit a resolution confirming that the elected official’s position meets the governmental unit’s hourly standard (600 or 1,000 hours a year), and be prepared to document the time actually required to perform the duties of the office (Exhibit 6FF). Refer to Paragraph 3.65 E. Elected Officials for more information. 6.60 E. Adoption of the 1,000 Hour Standard (Form 6.68, Exhibit 6GG) Governmental units (except school districts, and special education cooperatives) may, at their option, change from the 600-hour annual standard to a 1,000-hour annual standard by adopting and filing resolution Form 6.68, “Resolution - Adoption of the 1,000 Hour Standard for IMRF Participation.” (The 1,000-hour standard did not exist before January 1, 1982.) If the 1,000-hour annual standard is adopted, it cannot be revoked. The 1,000 hour annual standard for IMRF covered positions must be applied to all positions within that governmental unit, including elected officials. If an employer changes its hourly standard from 600 to 1,000, any member who participated under that employer before it changed its hourly standard remains grandfathered under 600 hours. The member participates in IMRF under that employer if the position requires 600 hours or more, even if the employer now has a 1,000-hour standard. Page 260 January 2014
Illinois Municipal Retirement Fund Member Accounts / Past Service / Employer Resolutions / SECTION 6 6.60 F. To Include Compensation Paid Under an Internal Revenue Code Section 125 Plan as IMRF Earnings (Form 6.72, Exhibit 6II) Section 125 cafeteria plans may be established under Section 125 of the Internal Revenue Code. Most options under a cafeteria plan are not reportable as IMRF earnings. If there is a cash option, it is IMRF earnings and must be reported to IMRF, unless the cash equals the employer’s cost for health insurance. ny employer may elect to include compensation paid under a cafeteria plan by adopting a governing body resolution (IMRF Form 6.72, “Resolution - To Include Compensation Paid Under an IRC Section 125 Plan as IMRF Earnings”). If such a resolution is adopted, most options under a cafeteria plan will be considered IMRF earnings and must be reported to IMRF. Compensation directed into a premium conversion plan or flexible spending account is not IMRF earnings unless the employer elects to include it in earnings by governing body resolution (IMRF Form 6.72). These resolutions, when adopted, may not be changed or revoked for current employees but only for new hires. For more information on what is considered IMRF earnings, refer to Section 3, Part 3. 6.60 G. To Include Compensation Directed into a Retirement Health Savings Plan (Form 6.73, Exhibit 6JJ) Retirement health savings plans are employer-sponsored health benefit savings vehicles that allow pre-tax savings for the cost of medical expenses (health insurance premiums, co-pays, prescription costs, etc.) after retirement. These plans are funded in a variety of ways. Compensation directed into a retirement health savings plan is not included as IMRF earnings, and therefore not reportable to IMRF, unless the employer’s governing body adopts a resolution making that compensation reportable. If the employer wants to report to IMRF the compensation directed into the retirement health savings plan, its governing body would adopt a resolution, IMRF Form 6.73, “Resolution - To Include Compensation Paid Under a Retirement Health Savings Plan as IMRF Earnings.” For more information on what is considered IMRF earnings, refer to Section 3, Part 3. 6.60 H. To Adopt IMRF Early Retirement Incentive (Form 6.77, Exhibit 6KK) If a unit of government is considering adopting the IMRF Early Retirement Incentive (ERI), its governing body would pass a resolution or ordinance adopting the ERI after reviewing the actuarial cost estimate prepared by IMRF. This cost estimate is mandatory. The ERI would be available for one year from the program effective date. If an IMRF employer adopts the program, the ERI applies to all eligible IMRF members, regardless of the position held or length of service with the unit of government. The ERI would also apply to elected officials participating in IMRF. Refer to Paragraph 5.20 C. IMRF Early Retirement Incentive (ERI) for more information. Limitations on Successive ERI Windows Effective with ERI windows opened on or after December 31, 2013, another window may not be adopted for five years after the close of the previous window. Dissolving employers If an employer is aware—or has reason to be aware—of its future dissolution under state law, and its IMRF assets and liabilities will be transferred to: One successor unit of government The dissolving employer must provide the ERI Cost Study to the successor, and the successor must also approve the ERI. A copy of the successor unit’s resolution approving the ERI must be available to IMRF upon request. January 2014 Page 261
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Instructions EXHIBIT 6S Page 1 of 2
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EXPLANATION AND INCOME TAX INFORMAT
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A RESOLUTION RELATING TO PARTICIPAT
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Limitation on Frequency • Employe
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Section 6 - IMRF

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