For members of the Law Enforcement Officers' and Fire Fighters' Retirement System Plan 2
Updated September 2007
The Law Enforcement Officers' and Fire Fighters' (LEOFF) Retirement System Plan 2 provides disability benefits for members who become totally incapacitated for continued employment in a LEOFF-eligible position. This publication provides information about eligibility for non-duty, duty and catastrophic duty disability retirement benefits, and the requirements for continued eligibility. The Department of Retirement Systems (DRS) recommends that you contact a LEOFF retirement services analyst if you intend to apply for disability benefits. See the “How Do I Apply?” section.
You may also be eligible for benefits from the Department of Labor and Industries (workers’ compensation benefits), the Department of Social and Health Services, the Social Security Administration and your employer (disability leave supplement or similar benefits). Please contact these organizations directly for more information.
You may be eligible for disability retirement benefits if you are totally incapacitated for continued employment with your LEOFF employer and you leave that employment as a result of the disability. No minimum amount of service credit is required for you to be eligible for a LEOFF Plan 2 disability retirement benefit.
You must file an application with DRS before you can qualify for disability retirement benefits. DRS will determine whether or not you are capable of carrying out the duties of the job that you performed at the time of the disability, or any other LEOFF eligible employment you are qualified to perform. DRS will also determine if your disability occurred in the line of duty. You are responsible for scheduling and paying for independent medical examinations to prove that you qualify for a disability retirement benefit.
If your disability occurred in the line of duty, you may choose between a non-taxable:
Final average salary (FAS) is the monthly average of your 60 consecutive highest-paid service credit months. If you have fewer than 60 service credit months when you become disabled, the average will be based on your actual total of service credit months. If the normal retirement benefit calculation rule (see non-duty disability calculation) yields a monthly benefit greater than 10% of your FAS, you will receive the higher benefit amount, but only the amount equal to 10% of your FAS is non-taxable.
Note: Contributions made to restore service credit after the restore deadline are only refunded at 100%.
If your disability occurred in the line of duty and is so severe that it prevents you from performing “substantial gainful employment” in any capacity in the future, you may be entitled to receive a catastrophic duty disability retirement benefit. “Substantial gainful employment” is defined as average earnings of not more than $890 a month. The catastrophic duty disability benefit is equal to 70% of your FAS. This benefit is subject to being offset by any Social Security disability and workers’ compensation time-loss and permanent disability payments. Your total benefits under catastrophic duty disability can not exceed 100% of your FAS. However, in no case can the offset reduce your LEOFF benefit below your accrued retirement benefit.
If you do not earn full service credit because of leave associated with a duty disability, you have the option to purchase up to 24 months of service credit for each covered duty disability. To establish service credit:
If your duty disability occurred on or after July 23, 1989, but before July 1, 2002, the purchase of TDD service credit is limited to six months and requires that you received a disability leave supplement or similar benefits from your employer.
If you are not eligible to purchase TDD service credit, you may be eligible under leave-of-absence provisions. See your LEOFF Plan 2 Member Handbook for more information.
If your disability did not occur in the line of duty, you may receive a monthly benefit calculated as follows:
2 percent x FAS x service credit years.
Service credit refers to your years of service at the time you separated from employment. (For FAS definition, see “Duty Disability” section.) Your benefit will be actuarially reduced to reflect the difference between your age at the time of disability retirement and age 53. The reduction is determined using the actuarial tables provided by the Office of the State Actuary. If you are age 50 and have 20 years of service, the reduction is three percent per year from age 53.
If your monthly benefit will be less than $50, you may choose between a monthly benefit or a lump sum payment. If you choose a lump sum payment, you are considered retired from LEOFF. If you choose a monthly benefit, you cannot take a lump sum payment at a later date.
Duty disability benefits are non-taxable for amounts up to 10% of your FAS. (See “Duty Disability” section under “What is my benefit?”.) Non-duty disability benefits are subject to federal income tax, with the exception of any portion taxed before it was contributed. After you retire, DRS will let you know how much (if any) has already been taxed, and is therefore exempt. You will then need to complete a W-4P form so the proper tax amount is withheld from your monthly benefit. If you do not complete the form, DRS will apply IRS withholding rules as though you are married and claiming three exemptions. It is your responsibility to declare the correct amount of taxable income on your income tax return.
For both duty and non-duty disabilities, if you choose monthly benefit payments, you may select a single beneficiary to receive a continuing benefit in the event of your death. However, if you select a survivor option your benefit will be reduced. The benefit reduction will be based on the survivor option you choose and the difference between your age and the age of the beneficiary you select. To learn more about designating a beneficiary and survivor benefit options, please refer to your LEOFF Plan 2 Member Handbook.
On July 1 of every year following your first full year of retirement, your monthly benefit will be adjusted by the percentage change in the Consumer Price Index (CPI-U, Seattle), to a maximum of three percent per year.
If you receive a monthly disability retirement benefit, DRS may require you to undergo periodic comprehensive medical examinations. You or your doctor must report any change in your condition to DRS.
If a medical examination shows that you have recovered from your disability and you are no longer entitled to workers’ compensation benefits, DRS will cancel your retirement benefit and issue an order that you be restored to duty. If this happens, you will be entitled to notice and a hearing. If you are unable to perform the duties of your former rank, you may request assignment to a lower rank which has duties you are able to perform. In no event are you to be restored to duty at a pay rate that is less than the current rate for the position you held at the time you began your retirement. Following cancellation of your disability retirement benefit and upon your return to a LEOFF eligible position, you will again earn service credit and become eligible for the benefits available to an active member.
If you are receiving a catastrophic duty disability benefit and you are capable of performing substantial gainful employment or if your average earnings exceed the standard established by the Social Security Administration, currently $890 per month, your benefit will automatically convert to a duty disability benefit even if you are still disabled from your LEOFF eligible position.
Contact DRS in writing or by phone and request an application. See contact information at the end of this publication. Provide the following information:
A retirement services analyst will provide you with an estimate of your benefit at the time the disability application is mailed to you. When you receive your packet, make sure that all three parts of the LEOFF Plan 2 Disability Retirement Application are completed by the proper persons and returned to DRS.
You may apply for a disability retirement and receive a determination of eligibility prior to separating from employment. You do need to be separated from employment in order to receive disability benefits.
Once DRS has received all three parts of the disability application (as described under “How do I apply?”) the determination process may take between two to four weeks. The process may take longer if the application is incomplete or if DRS requires additional information from you or other sources concerning your application.
A retirement services analyst will contact you if DRS needs additional information. The disability allowance paid to a disabled member accrues from the first day of the calendar month immediately following the member’s separation from employment for disability.
Your disability retirement benefits may be affected if you go to work for any public employer in Washington. In some cases, depending on the position and the extent to which you work, retirement benefits may be suspended, and you may be required to make contributions to a retirement system. If you decide to return to work, you may call DRS to determine how your benefits will be affected. You will find a brief summary of the returning-to-work requirements in the DRS publication Thinking About Working After Retirement (Plan 2)?
If DRS denies your application for benefits or determines that your disability did not occur in the line of duty, you may petition for a review within 120 days of receiving the denial. Instructions for how to petition a decision will be mailed to you if your application is denied.
If your disability retirement application is denied, do not file another application based on the same medical condition. DRS does not consider it a new application and will uphold the original decision. However, if the same condition gets worse or if you are able to provide additional information, you may file another application.
If you receive an overpayment of your disability benefit or refund, DRS will require you to repay the overpayment. If you receive an underpayment, DRS will correct the error and pay you in full.
Your retirement benefits may be subject to payment of court and administrative orders for spousal maintenance and child support, or payment of any orders authorized by federal law. DRS is authorized to divide benefits between members and ex-spouses based upon court-ordered property division. If the divorce decree complies with the applicable law, DRS will send the property division payment directly to the ex-spouse. See the DRS online publications, How Can a Property Division Affect My Retirement Account? and Can Legal Action Affect My Retirement Account?
If you have questions about LEOFF Plan 2 disability benefits that are not covered in this publication, please contact DRS. Be prepared to provide your name, Social Security number, and retirement system and plan.
