LEOFF Plan 2

When can I purchase? 

When you are retiring.

Are there limits to the annuity amount I can purchase? 

Minimum: $25,000; There is no maximum.

How much does it cost? 

Log in to your account and choose “Purchasing Annuity.” Here you can find the monthly increase to your pension for any purchase amount.

What type of funds can I use to purchase an annuity? 

Your payment must come from an eligible governmental plan, like your pretax DCP savings. Members cannot use PERS/SERS/TRS Plan 3 contributions to pay for this annuity.

When does my annuity benefit begin? 

Your retirement date or the day after your bill for the annuity is paid in full, whichever comes later.

How often do I receive my annuity benefit? 

Monthly.

Can I designate a survivor?

Yes. Your survivor must be the same survivor and survivor option you chose for your retirement benefit.

Will I receive a Cost-of-Living Adjustment (COLA)? 

Yes. You will receive a COLA up to 3% annually.

How do I purchase this annuity? 

Request this annuity when you retire online. You can also purchase it when completing a paper retirement application.

Can I cancel the annuity if I change my mind? 

In most cases, no. Annuities are fixed income sources. Once you purchase the annuity, you will not have access to the funds you used to make the purchase.

There are two exceptions:

If you have not completed the annuity purchase, you can still change or cancel the annuity.

Once you make the purchase, you’ll have 15 days to cancel the transaction. You’ll receive a mailed letter that includes your rescission, or cancel by date.

Will my annuity purchase be refunded when I die? 

If you (and your survivor if you selected a survivor option) die before the amount of your annuity purchase has been paid back to you, the difference will be refunded to your beneficiary.

What if I return to work? 

Your annuity continues.

When can I purchase? 

When you are retiring.

Are there limits to the amount of service credit I can purchase? 

Minimum: One month; Maximum: 60 months.

How much does it cost? 

Log in to your account and choose “Purchasing Service.” Here you can find the estimated cost and income increase per month you purchase.

What funds can I use to purchase service credit? 

You can use any funds except for Plan 3 contributions. Funds rolled over from your DCP account must be pretax.

When does my annuity benefit begin? 

After you have made payment in full.

How often do I receive the benefit? 

Monthly.

Can I designate a survivor? 

Yes. Your survivor will be the same option you chose for your retirement benefit.

Will I receive a Cost-of-Living Adjustment (COLA)? 

Yes. You will receive a COLA up to 3% annually. If you’re a TRS Plan 1 or PERS Plan 1 member, a COLA is an optional choice at retirement.

Can I cancel the annuity if I change my mind? 

No. Annuities are fixed income sources. Once you purchase the annuity, you will not have access to the funds you used to make the purchase. If you have not completed the annuity purchase, you can still change or cancel the annuity.

How do I purchase service credit? 

Request this annuity when you retire online. You can also purchase it when completing a paper retirement application.

Will my annuity purchase be refunded when I die? 

Yes. If you (and your survivor if you selected a survivor option) die before the amount of your purchase has been paid back to you, the difference will be refunded to your beneficiary. For TRS Plan 1, this refund does not apply if you selected the Maximum Option.

What if I return to work? 

The return to work rules for service credit are the same as your retirement benefit. If you return to work for a DRS-covered employer, your annuity will stop if you return to retirement system membership or if you exceed allowable hours as a retiree (867 per year). If you do not return to a DRS-covered employer, your annuity will continue.

When will my benefit increase be effective? 

The increase in your benefit will be effective the day after the department receives your full payment.

Death of a retired member

Please contact DRS as soon as possible. If the retiree chose a survivor benefit, we must update the account for payments to continue. If the retiree did not select a survivor option, we need to stop monthly benefits to avoid an overpayment.

When you contact us, please be ready to provide the deceased retiree’s:

• Full name
• Social Security number
• Date of death

We’ll also ask who is handling the affairs for the estate.

Report a death to DRS

Online: Report the death online.

Phone: 360-664-7081, Option 1

Email: drs.moddnd@drs.wa.gov – Please provide only the last 4 digits of the deceased’s SSN

Mailed form: Print and mail this death reporting form to DRS.

Death of an active or not yet retired member

If the deceased worked in a public service position in Washington, payment may be due to survivor(s). When you contact us, please be ready to provide the deceased member’s full name, Social Security number and date of death. Also tell us if the death may be work-related.

Death of a beneficiary or survivor

If you are an active member, you can update your beneficiary designation at any time by logging into your online account.

If your named survivor dies after you retire, you can have your pension benefit changed to the single-life option with no survivor reduction. You will need to report the death to DRS. This provision applies to all DRS plans except for LEOFF and WSPRS Plan 1, which have different survivorship options.

If you are a LEOFF Plan 2 member and you become disabled, you might be entitled to a disability benefit. The Department of Retirement Systems (DRS) recommends you contact a Retirement Specialist if you plan to apply for a LEOFF disability retirement.

Am I eligible for a disability retirement benefit?

If you are totally incapacitated for continued employment with your LEOFF employer and you leave that employment as a result of your disability, you might be eligible for a disability retirement benefit.

You do not need a minimum amount of service credit to be eligible for a disability benefit.

You must file an application with DRS before you can qualify for a disability benefit. DRS will determine whether you are capable of carrying out the duties of the job you performed at the time of the disability or any other LEOFF-eligible employment you are qualified to perform. DRS will also determine whether your disability occurred in the line of duty. You are responsible for scheduling and paying for independent medical examinations to prove you qualify for disability retirement.

Each benefit has its own eligibility requirements. The four types of disability benefits are:

• Temporary duty disability
• Nonduty disability
• Duty disability
• Catastrophic duty disability

Temporary duty disability

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, you must meet the following criteria:

• Your disability must have occurred in the line of duty.
• You must have received your injury on or after July 1, 2002, and be eligible to receive workers’ compensation benefits.
• You and your employer must make employer and member contributions on the compensation you would have earned had you been working. If the payments are made for a retroactive period, interest is charged. If your employer offers a disability leave supplement or similar benefit, your first six months of service credit are interest free.

If your duty disability occurred between July 23, 1989, and June 30, 2002, the amount of service credit you can purchase is limited to six months and requires that you be receiving a disability leave supplement or similar benefit from your employer.

Duty disability

If your disability occurred in the line of duty, you may choose between a:

• One-time payment equal to 150% of your eligible retirement contributions
• Minimum monthly benefit of at least 10% of your FAS

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 yields a monthly benefit greater than 10% of your FAS, you will receive the higher benefit amount. However, only the amount equal to 10% of your FAS is nontaxable.

Contributions made to restore service credit after the deadline are refunded at 100% only.

LEOFF benefit enhancements in addition to your monthly line-of duty disability benefit

One-time lump-sum benefit for a line-of-duty disability

LEOFF Plan 2 members who retire with a line-of-duty disability on or before Feb. 1, 2021, will receive a 2% multiplier retirement allowance with a one-time lump-sum benefit enhancement equal to $100 per service credit month or $20,000, whichever is greater. This is in addition to their monthly line-of-duty disability benefit.

If a LEOFF Plan 2 member dies after this law is effective but before the distribution of the lump-sum benefit takes place, the distribution will be made to their designated beneficiaries. The percentage of the payout will be the same as the member designated on their account.

If the member dies after Feb. 1, 2021, but before retirement, these pension benefits will also apply to the member’s designated beneficiaries.

If you should die after this law is effective but before the distribution of the lump-sum benefit takes place, the distribution will be made to your designated beneficiaries. The percentage of the payout will be the same as you designated on your account.

If you should die before you retire, these pension benefits will also apply to your designated beneficiaries.

Disaster response disability

There are certain circumstances, on or after March 22, 2014, when you might qualify for disaster response benefits and service credit. In the two situations listed below, your disability must have occurred while you were in eligible federal service providing eligible emergency management services.

Working for a LEOFF Plan 2 employer: You might qualify for a disability benefit if you leave the employment of your LEOFF Plan 2 employer to provide a disaster response, and you become disabled on or after March 22, 2014. Your benefit won’t be reduced if you retire early. The benefit will be a minimum 10% of your Final Average Salary.

Working in eligible federal service: You might qualify for service credit for a leave of absence if you become disabled when you leave the employment of your LEOFF Plan 2 employer to provide a disaster response, on or after March 22, 2014.

Nonduty disability

If your disability didn’t occur in the line of duty, you might receive a monthly benefit calculated as follows:

2% x FAS x total service credit years = base monthly benefit and service credit months x $100 = one-time lump-sum amount

Or

2% x FAS x total service credit years = base monthly benefit + .5% x FAS x multiplier service credit years = multiplier monthly benefit

Final Average Salary (FAS) is the monthly average of your 60 consecutive, highest-paid service credit months.

Your monthly benefit will be reduced to reflect the difference between your age at the time of your disability retirement and age 53.

If you are age 50 and have 20 years of service credit, the reduction is 3% per year (prorated monthly) from age 53.

Catastrophic duty disability

If your disability occurred in the line of duty and is so severe it prevents you from performing substantial gainful activity or substantial gainful employment in any capacity in the future, you might be entitled to receive a catastrophic duty disability benefit.

The Social Security Administration defines “substantial gainful employment” as working in a position whose average earnings are more than a set dollar amount each month, a figure it updates annually.

The catastrophic duty disability benefit can be calculated in four ways:

• 70% of your FAS
• 100% of your FAS, offset by Social Security disability and workers’ compensation disability payments
• 2% x FAS x service credit years = base monthly benefit and service credit months x $100 = one-time lump-sum amount or $20,000, whichever is greater
• 2% x FAS x total service credit years = base monthly benefit + .5% x FAS x years of service = multiplier monthly benefit

In addition to your monthly benefit, you will be reimbursed for premiums you pay for employer-provided health insurance, COBRA, and Medicare Parts A and B.

If you are entitled to Medicare, you must enroll and maintain enrollment in both Medicare Parts A and B to remain eligible for the reimbursement.

These premium reimbursements are not taxable.

Medical insurance reimbursements are available for current, past and eligible COBRA enrollees. Reimbursement for these members is never greater than the COBRA coverage they are eligible for.

Example

COBRA covers you up to $800. You have medical insurance costs of $500. Your premium reimbursement is $500. If your medical insurance costs are $1,000, your total reimbursement is $800 — the entire COBRA coverage you are entitled to. You will not be reimbursed for the additional $200 owed toward your medical insurance.

If you are receiving a catastrophic duty disability benefit and you are capable of performing substantial gainful activity or substantial gainful employment or your average earnings exceed the monthly limit, your benefit will automatically convert to a duty disability benefit and you’ll no longer be reimbursed for your medical premiums.

If you are able to perform in a LEOFF-eligible position, your benefit will be stopped.

How to apply for a disability retirement

Call DRS and request an official estimate for a disability retirement. It takes about 3-4 weeks for DRS to calculate your benefit estimate. Then we will mail you a packet with the estimate and a three-part form. You, your employer and your doctor will need to complete all three forms in the packet.

Please send the following documentation with your disability application:

• All medical records, reports and charts pertaining to your disabling condition
• Complete physician information, especially if you are being treated by more than one doctor
• A copy of the most recent job description
• Department of Labor & Industries or self-insurer file documentation, such as the Report of Accident, Independent Medical Examinations, chart notes from all treating medical providers, medical documentation supporting your inability to work or return to a particular type of work and vocation records
• If you are applying for catastrophic disability, also send DRS a copy of your Social Security Administration disability award letter and any additional medical information the Social Security Administration provides

If your employer is self-insured, they can manage the claim or hire a third party (TPA) to manage the claim. They are not required to send these records to Labor & Industries. You may need to ask in writing for the self-insured employer or their TPA to send a copy of your medical records to Department of Labor & Industries or directly to DRS.

If you are eligible, you can also choose to service retire pending the outcome of your disability application. You will need to fill out a service application independent of your disability application. Most service applications can be completed through your online account.

How long will it take for a determination to be made?

Once DRS receives all three parts of your application, as well as necessary support documentation, an initial determination can be made within four to six weeks. It could take an additional two to three weeks if your application needs to be reviewed by an independent medical advisor.

You can apply for disability retirement from DRS before separating from employment. If you have already separated, you can still apply for disability retirement as long as you separated from all LEOFF-eligible employment due to the disability. Your medical condition at the time of separation will determine whether you qualify for a disability retirement.

What is the lump sum payment option?

If your monthly benefit will be less than $50, you may choose between a monthly benefit and a lump sum payment.

If you choose the 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.

What happens once I receive a determination from DRS?

If you receive a denial: You may petition for a review within 120 days of receiving your denial letter. If your petition is denied, you will be informed of appeal procedures. You will have 60 days to appeal the decision.

If you are approved: DRS will mail you an approval letter with additional information. You must separate from employment to begin receiving your monthly disability benefit.

If you have not separated from employment within 90 days of your approval date, DRS will rescind its approval. If that happens, you must reapply and submit current medical evidence to be considered for a disability benefit.

Your retirement date is the first of the month following your date of separation. For example, if your application is approved May 4, and you separate from service May 15, your retirement date is June 1 and you will receive your first monthly benefit on the last working day of June.

Could I be eligible for other disability benefits outside DRS?

You might also be eligible for disability-related benefits from the Department of Labor and Industries (workers’ compensation benefits), Department of Social and Health Services, the Social Security Administration, your employer, and disability insurers.

Except for catastrophic duty disability, the benefits you receive from the Social Security Administration, Department of Labor and Industries, or other disability insurers do not affect your benefit amount with DRS. However, the benefit from DRS could affect other benefits.

For more information, contact these organizations directly.

Can my monthly benefit increase after I retire?

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 to a maximum of 3% per year.

If you are receiving Social Security, DRS will adjust your benefit in January as well.

Can I lose my benefit?

If you are receiving a monthly disability benefit, DRS might require you to undergo comprehensive medical examinations at DRS’ expense. You or your doctor must report any changes in your condition to DRS. If medical examinations show you have recovered from your disability, DRS will cancel your disability benefit and issue an order that you be restored to duty. If this happens, you will be entitled to receive notice and a hearing.

If you are unable to perform the duties of your former rank, you may request assignment to a lower rank that has duties you are able to perform. At no time should you be restored to duty at a pay rate that is lower than the current rate for the position you held at the time of your retirement. Following cancellation of your disability benefit and upon your return to a LEOFF-eligible position, you will begin earning service credit again and become eligible for an active member benefit.

Can I work after taking a disability retirement?

Your disability benefit could be affected if you go to work for any public employer in Washington state. In some cases, depending on the position and the extent to which you work, your disability benefit might be suspended and you might be required to make contributions to a retirement system. If you decide to return to work, call DRS to determine how your benefit will be affected.

Errors, taxation and assignment of benefits

Payment errors: If you receive an overpayment of your monthly benefit, you will be required to repay it to DRS. If you receive an underpayment, DRS will correct the error and pay you the amount owed.

Federal income taxes: A duty disability benefit is not taxable for amounts up to 10% of your FAS. A nonduty disability benefit is subject to federal income tax. You will 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 single with no adjustments.

Assignment and attachment of benefits: Your disability benefit could be subject to assignment or attachment to satisfy court and administrative orders for spousal or domestic-partnership maintenance and child support or orders federal law authorizes.

DRS is authorized to divide pensions between members and ex-spouses or ex-partners based on court-ordered property division. If the divorce decree or dissolution of domestic partnership complies with the applicable law, DRS will send the property-division payment directly to the ex-spouse or ex-partner.

Separating

If you separate from LEOFF employment, you can either withdraw your funds, retire if you meet eligibility requirements or leave your funds in the plan if you are vested for a future retirement. You can also leave your funds in the account if you have a balance of more than $1,000. If you are inactive and non-vested with a balance of less than $1,000, DRS is required to close your account and return the funds to you. The IRS requires you to start receiving your monthly benefit by age 73, unless you are still employed.

If you have 10 or more years of LEOFF service credit, you can withdraw 150% of your accumulated contributions. If you decide to withdraw your contributions, you give up your right to a future LEOFF retirement benefit. You can restore your contributions and re-establish your benefit only in certain circumstances.

There are tax implications to withdrawing your contributions, so you might want to contact the IRS or a tax advisor before making a decision. 

Be sure to keep us up to date on any changes to your name, address or beneficiary. It’s important that you keep your beneficiary designation current, because a divorce, marriage or other circumstance might invalidate it.

For more information about your options when separating, see this short career transitions video.

Service credit is cumulative

The service credit you earn toward vesting is cumulative. This means if you separate but later return to public service, you can continue to earn service credit toward your vested status even if you didn’t yet qualify when you separated. For Plan 1 and Plan 2 members, withdrawing your contributions when you separate will set your service credit years to 0.

Withdrawals

For information about withdrawing your retirement contributions before retirement, see Withdrawal of Retirement Contributions.

Withdrawal amounts are based on your total contributions made from your paychecks, plus accumulated interest. See below for information on regular interest.

Current and historical rates of regular interest

Loans and borrowing

Due to Internal Revenue Service regulations regarding government pension plans, none of the state retirement pension plans allow for loans or borrowing from your contributions. Retirement plan members, you can only access the funds you’ve contributed if you have separated employment from a DRS-covered employer.

The Washington Deferred Compensation Program (DCP) does not allow loans. If you have a DCP account, an Unforeseeable Emergency Withdrawal may be possible under certain criteria. More about DCP emergency withdrawals.

If you need to show proof of your account balance or monthly pension payment to secure a home loan, mortgage or other borrowing, log in to your DRS online account to view, print or download an account balance or pension verification letter.

Returning

If you leave your position, withdraw your contributions and later return to work covered by LEOFF, you might be able to restore your previous service credit. To do so, you must repay the total amount of the contributions you withdrew plus interest within five years of returning to work or before you retire, whichever comes first. Contact us to find out that amount.

A dual member, or someone who belongs to more than one retirement system, might be able to restore service credit earned in a retirement system other than LEOFF. Each time you become a dual member, you’ll have 24 months to restore service credit earned in a previous retirement system.

It might still be possible to purchase service credit after the deadline has passed. However, the cost in that case is considerably higher.

Retired? See working after retirement.

Service credit is the time used to calculate your pension retirement income. Sometimes customers notice their service credit doesn’t match their seniority date—these times do not always match. Often, the difference is because of missing or withdrawn service credit. You may be eligible to purchase some or all of the missing credit. Here is what you need to know about the process.

How do I check my service credit?

View your complete service credit history through your online account. It is a good practice to check your service credit every few years to be sure it matches your expectations.

Contact DRS for a cost estimate

You will need to contact DRS to request a cost for restoring your credit. We are not able to provide an estimate when you call. Similar to a retirement benefit estimate, this cost must be calculated by DRS and may require information from your employer.

You’ll need this information

The following preparation can expedite your request:

Provide the dates for the missing service. Find your service credit history in your online account.

Let us know if there is a gap in your service credit or if you withdrew from your account.

• If there is a gap in your service credit, do you know why? Were there any special circumstances around your employment at the time? Some common events for missing credit include: authorized leave of absence, childbirth, substitute teaching, temporary duty disability, or injury.
• If you withdrew from your account, when did you pull out the contributions?

How do I pay?

Make direct payment with either a personal or cashier’s check. Or in many cases it’s also possible to transfer funds from another eligible retirement account to purchase service credit. However, DRS cannot accept funds in excess of the cost to make your purchase. Check with your account administrator to see if you can transfer those dollars to a 401(a) account type.

There is a deadline

You must request and purchase the missing service within the timeframe allowed for your plan. The amount of time varies by plan. Ask DRS about your options for purchase. If the deadline has passed, you may still have the option to purchase additional service credit as an annuity option when you retire. This purchase will not restore missing time, but it would be used in your retirement payment calculation.

The retiree resources page includes the following:

• Annual COLA updates
• Pension payment schedule
• How to get a proof of income letter
• And more

Visit the retiree page

How will your retirement income be affected if you return to work? It depends on where you work.

If you are returning to a LEOFF-eligible position, your benefits will stop and you will return to active contributing membership.

If you are considering returning to employment in a position covered by another DRS-retirement system (non-LEOFF), talk to your potential employer or contact DRS to find out how your retirement benefit could be affected.

Working for a non-DRS covered employer

Unless you’ve been approved for a disability retirement, you can return to work for an employer not covered by a Washington state retirement system without affecting your monthly benefit.

If you are a member of more than one Washington state retirement system, you are a dual member. You can combine service credit earned in all dual member systems to become eligible for retirement.

Example
If you retire at age 53 with three years of service credit from LEOFF Plan 2 and four from the Public Employees’ Retirement System (PERS) Plan 2, you are a dual member. Without dual membership, your service wouldn’t be eligible for a monthly benefit from either system. With dual membership, your service credit is combined, giving you enough to retire. Your benefit is calculated with service from that system alone. Here’s the calculation:

2% x 3 (LEOFF service credit years) x Final Average Salary (FAS) = LEOFF benefit

2% x 4 (PERS service credit years) x FAS = PERS benefit

LEOFF benefit + PERS benefit = total monthly benefit

See the multiple plans page for more information about dual membership.

See a live or recorded membership in multiple plans webinar.

Do you have U.S. military service? If you leave or reduce your DRS retirement plan-covered employment to serve in the military, you could be eligible for restoration of missing retirement service credit. The amount of service credit you have directly affects your retirement income calculation.

There is a deadline

You must complete payment for the military service credit within five years of returning to DRS-covered employment, or before you retire, whichever comes first. After this time has passed, and if the service does not qualify for no-cost service, you will no longer be eligible to replace the service credit using the military credit program. However, you can still purchase the service credit for a much higher cost as an optional bill past the statutory deadline date up to the time you retire (RCW 41.50.165). The longer you wait, the more it costs.

How much will it cost?

You can apply to recover up to five years of interruptive military service credit (sometimes up to 10 years depending on your circumstance). If your military service was during a period of war or an armed conflict during which you earned a campaign badge or medal, you might be able to recover up to five years of service credit at no cost to you.

For other interruptive military service, you can apply to receive an optional bill for the retirement contributions you would have paid on your normal salary during that time. However, you must pay your optional bill within five years after you return to work, and you must be working for the same employer you left to serve in the military. If you don’t pay the bill within five years, you might still be able to purchase the service credit, but at a much higher cost.

How do I apply?

Contact DRS about a month and a half after you return to work to ask about recovering military service credit. You will then submit information, such as a copy of your DD214 service record, to help us determine your eligibility. DRS will review your account as well as the information you provide and notify you of our findings, including an optional bill if applicable. This usually takes 2-3 weeks.

Other ways to increase your retirement

Depending on the type of funds you have available, DRS has a couple of annuity purchase options to increase your monthly pension amount.

Additional information for LEOFF Plan 2 customers

I’m a member of LEOFF Plan 2. When am I eligible for disaster response service credit?

There are certain circumstances, on or after March 22, 2014, when members of LEOFF Plan 2 might qualify for disaster response benefits and service credit. In all situations listed in this section, your disability or death must have occurred while you were in eligible federal service providing eligible emergency management services.

Death benefit while working for a LEOFF Plan 2 employer

Your surviving spouse, registered domestic partner or, if none, the guardian of your minor child or children might qualify for an unreduced death benefit if you leave the employment of your LEOFF Plan 2 employer to provide a disaster response and you die on or after March 22, 2014. The benefit will be a minimum 10% of your Final Average Salary.

Disability benefit while working for a LEOFF Plan 2 employer

You might qualify for a disability benefit if you leave the employment of your LEOFF Plan 2 employer to provide a disaster response and you become disabled on or after March 22, 2014. Your benefit won’t be reduced if you retire early. The benefit will be a minimum 10% of your Final Average Salary.

Service credit for leave of absence while working in eligible federal service

You might qualify for service credit for your leave of absence if you become disabled when you leave the employment of your LEOFF Plan 2 employer to provide a disaster response on or after March 22, 2014. Your surviving spouse, registered domestic partner or, if none, the guardian of your minor child or children might qualify for this service credit if you die as a result of this federal service.

Your retirement account can be affected by changes in your marital status. If you marry or divorce before you retire, you need to update your beneficiary, even if your beneficiary remains the same.

Marriage

If you are married when you retire, you choose from a few benefit options that can include retirement income coverage for your spouse if you die before them.

If you marry after retirement, you could be eligible to change your benefit option to add your spouse. You need to be married at least a year and request DRS add your spouse during your second year of marriage.

If you become widowed after retiring, you can have your benefit option changed to the single-life option with no survivor reduction. You will need to report the death to DRS.

See more about changing your survivor after retirement.

Contact DRS for more information.

Divorce or separation

For questions about a property division, or to start the process, contact DRS.

For further research on property orders, see WAC 415-02-500.

Federal taxes on your benefit

Most, if not all, of your benefit will be subject to federal income tax. The only exception will be any portion that was taxed before it was contributed. When you retire, we will let you know if any portion of your contributions has already been taxed.

Since most public employers deduct contributions before taxes, it’s likely your entire retirement benefit will be taxable.

At retirement, you must complete and submit an IRS W-4P form to let us know how much of your benefit should be withheld for taxes. If you don’t, DRS is required to withhold federal taxes as if you are single with no adjustments. To adjust your IRS tax withholding amount after retirement, log in to your online account or mail a new W-4P form to DRS.

For each tax year you receive a retirement benefit, we will provide you with a 1099-R form to use in preparing your tax return (see 1099-R). These forms are usually mailed at the end of January for the previous year. The information is also available through your online account.

It is your responsibility to declare the proper amount of taxable income on your income tax return.

If you opt to deduct health care from your monthly pension payments in retirement:
The IRS considers health insurance premiums paid via your monthly pension as part of your taxable income. This is because your pension contributions were not taxed (see IRS page 8). Visit the retired member page for more information about deductions in retirement.

Federal benefit limits for high income members

If you are a highly paid member or retiree, you may encounter a federal limit on your retirement benefit. There are two federal regulations that could limit benefits for highly paid members and retirees. The salary limit (which restricts the salary used to determine your benefit) and the benefit limit (which limits the annual benefit amount you can receive). In other words, federal law limits the amount of compensation you can pay retirement system contributions on, and that can be used in your benefit calculations. The IRS can adjust the amount each year.

2025 salary limit

The 2025 limit is $350,000. This means any salary you earn over this amount in 2025 will not be part of your retirement contributions or your pension calculation. See the following section for more information on how this limit applies to you.

Internal Revenue Salary Limit for Active Members

If you began public service before 1/1/96

• You don’t have a salary limit
• You pay contributions on all salary earned
• DRS does not adjust your Average Final Compensation for limit testing purposes
• Your pension calculation is not affected by salary limits
• IRC section 415(b) requires that your annual benefit must not exceed the limit. If you don’t exceed the benefit limit at the time you retire, it is still possible that your benefit may be affected at a later date.

If you began public service on or after 1/1/96

• The current year salary limit applies (see above)
• The salary limit is the same for all members and is adjusted annually by the IRS
• If you reach the salary limit in a calendar year, you stop paying contributions
• DRS notifies your employer when you approach the salary limit
• Your Annual Final Compensation is capped for limit testing purposes if it includes the years you exceeded the salary limit
• Your pension calculation is affected by salary limits

How do survivors or beneficiaries impact the limit?

Does my benefit amount change for my survivor beneficiary after I die?

No. If you chose to provide for a survivor beneficiary, and you die before your survivor does, your benefit transitions to your survivor at the rate you chose (100%, 50% or 67%). After the transition, your survivor’s benefit will also be tested.

What happens if my survivor beneficiary dies before I do?

If your survivor beneficiary dies before you do, your benefit increases as if you hadn’t chosen a survivor option. If your survivor beneficiary was your spouse or domestic partner, we will continue to use your original benefit amount in your annual testing. If your survivor beneficiary was not your spouse or domestic partner, we will use your new, higher limit amount in your annual testing.

More information about federal limits

The IRS characterizes the retirement systems as 401(a) defined benefit plans. To retain status as qualified plans, the systems must comply with federal regulations. For more information about salary limit regulations, see Internal Revenue Code (IRC) Section 401(a)(17). For more about benefit limit regulations, see IRC 415(b).

For more information see these IRS resources:

IRS Plan Benefit Limits

The beneficiary information you give DRS tells us the person(s) you want to receive your remaining benefit, if any, after your death. Submit or update your beneficiary information at any time before retirement using your online account. Or you can submit a paper beneficiary form.

If you don’t submit this information, any benefits due will be paid to your surviving spouse or minor child. If you don’t have a surviving spouse or minor child, we will pay your estate.

Be sure to review your beneficiary designation periodically and update it in your online retirement account if you need to make a change. If you marry, divorce or have another significant change in your life, be sure to update your beneficiary designation because these life events might invalidate your previous choices.

State-registered domestic partners, according to RCW 26.60.010, have the same survivor and death benefits as married spouses. Contact the Secretary of State’s Office if you have questions about domestic partnerships.

Visit the beneficiary page for more information.

Option 1: Single Life

This option pays the highest monthly amount of the four choices, but it is for your lifetime only. No one will receive an ongoing benefit after you die. If you die before the benefit you have received equals your contributions plus interest (as of the date of your retirement), the difference will be paid in a lump sum to your designated beneficiary.

Option 2: Joint and 100% survivor

Your monthly benefit under this option is less than the Single Life Option. But after your death, your survivor will receive the same benefit you were receiving for their lifetime.

Option 3: Joint and 50% survivor

This option applies a smaller reduction to your monthly benefit than Option 2. After your death, your survivor will receive half the benefit you were receiving for their lifetime.

Option 4: Joint and 66.67% survivor

This option applies a smaller reduction to your benefit than Option 2 and a larger reduction than Option 3. After your death, your survivor will receive 66.67% (or roughly two-thirds) of the benefit you were receiving for their lifetime.

Survivor options

Get real time examples of how your survivor option could affect your retirement benefit. Log into your online account and select the Benefit Estimator tool.

Spousal agreement at retirement

If you have a spouse, legally separated spouse or registered domestic partner, your spouse must give consent as part of your retirement application if you: Choose Single Life Option 1 or name someone other than your spouse as your survivor. If spousal consent is required and you are unable to provide it, your application could be delayed. You will need to notify DRS, and an Option 3 benefit will be paid to you with your spouse designated to receive the survivor benefit. You will be able to print out a spousal consent form after you complete your retirement application online or it will be included with your retirement application.

See a live or recorded benefit options webinar.

What is a rollover?  A rollover is moving funds from one eligible retirement plan to another.  Rollovers can include a rollover out (moving funds out of an account) and a rollover in (moving money into an account).

You can roll out your pension account contributions, DCP and Plan 3 investment balances at any time once you separate from service. Pension plan contributions made by your employer are not eligible for rollovers. These dollars remain in the pension trust fund and are only available to you as part of a monthly pension retirement income.

While DRS doesn’t charge fees for rollover services, your other financial institutions could. Make sure you’re aware of any fees or differences in expenses, options and services before you move your funds.

Converting a cash withdrawal to a rollover

If you make a cash withdrawal, you’ll have 60 days from the date you receive payment to deposit the funds into a traditional IRA or another eligible plan that accepts rollovers. Your rollover in amount must match the rollover out amount before taxes or the difference is subject to income tax. You may choose to pay the difference out of pocket when you roll it over. This difference could be recovered when you file your annual tax return with the IRS. Consult your tax advisor or visit this IRS page to find out more.

Rolling funds out

Your account contributions and interest can be rolled out once you separate from service. Complete the withdrawal process for your plan. It is your responsibility to confirm whether your chosen institution will accept rollover funds.

When considering whether to roll your contributions out of your plan, find out how much service credit you’ve earned. If you have at least five years, you qualify for a guaranteed monthly pension in retirement. Retiring with the pension is the only way to receive the contributions your employer has also been adding to your plan. Plan 2 members who withdraw or rollover their contributions will forfeit their pension.

You can begin the rollover process by completing the Plan 1 and Plan 2 Pension Withdrawal form.

Rolling funds in

Generally speaking, you cannot roll funds into your retirement benefit account. However, there are some unique circumstances which would allow you to do so. For example, you can roll funds in to purchase service credit or an annuity. Using rollover funds to make these purchases would be reported as a rollover for tax purposes. If you have service credit available to recover or purchase, contact DRS to find out more about your options.

Washington’s Deferred Compensation Program (DCP) does accept rollovers-in. More rolling funds into DCP.

Ask your employer if you will be eligible for health insurance coverage through a program like the Public Employees Benefits Board (PEBB) once you retire. You can also call the Health Care Authority at 800-200-1004 or visit hca.wa.gov.

If you qualify for continuing coverage after retirement, you must meet strict timelines to apply or request a deferral. If you are not entitled to PEBB coverage, you might be eligible for health insurance your employer provides. For more information, consult your employer.

If you opt to deduct health care from your monthly pension payments in retirement:
The IRS considers health insurance premiums paid via your monthly pension as part of your taxable income. This is because your pension contributions were not taxed (see IRS page 8). Visit the retired member page for more information about deductions in retirement.

Visit the health care page for more resources.

You are eligible for LEOFF Plan 2 membership if you were hired on or after Oct. 1, 1977, as a full-time, fully compensated and commissioned law enforcement officer or firefighter.

On or after July 1, 2024, ‘law enforcement officer’ includes any person who is commissioned and employed on a less than full-time, fully compensated basis to enforce the criminal laws of the state of Washington.

Law enforcement officers: A law enforcement officer is someone who works for a LEOFF employer and is commissioned and empowered to enforce the laws of the state of Washington. These positions include:

• County and deputy sheriffs
• Police chiefs
• City police officers (if appointed to offices, positions or ranks that a city charter provision or ordinance specifically designates)
• Town marshals and deputy marshals
• General authority law enforcement officers a state university or port district employs
• Directors of public safety and public safety officers (if cities or towns whose populations are less than 10,000 employ them)

The following positions are excluded from LEOFF membership:

• Noncommissioned people in positions that are primarily clerical or secretarial
• Deputy sheriffs who have not passed a civil service exam
• Directors of public safety or public safety officers in cities or towns whose populations are less than 10,000, if they were receiving a LEOFF retirement allowance on July 25, 1993

Firefighters: A firefighter is someone who has the legal authority and primary responsibility to direct or perform fire protection activities (preventing, controlling and extinguishing fires). Secondary fire protection activities might include incidental functions, such as housekeeping, equipment maintenance, grounds maintenance, fire safety inspections, lecturing, performing community fire drills, and inspecting homes and schools for fire hazards. Supervisory firefighter personnel meet the criteria of a firefighter.

The following positions are excluded from LEOFF membership:

• Firefighters who have not completed a civil service exam (if the employer requires it)
• Volunteer or resident volunteer firefighters