Mar 13, 2008 10:30 AM
If you are a retiree planning to stay in the work force or re-enter the work force on a full- or part-time basis, there are some important rules you must pay attention to so you don’t jeopardize your retirement allowance.
Now, under a more generous state law that is similar to the rules governing Social Security, there is no longer any limit on earnings for retirees 65 years of age or older who are working for New York State and collecting a New York State pension. That’s a five-year gain over the previous 70-year limit.
For retirees over 65, the amount you can earn in 2008 without affecting your pension has been eliminated. Check the following for the regulations appropriate for your circumstances.
As a retiree you may always work in private employment or in public employment, except you may not work in the employ of New York State or any of its political subdivisions, without affecting your retirement allowance.
In addition, there is no limitation on your earnings as a retiree beginning with the calendar year in which you reach 65 years of age.
A New York State public employee — such as you — who takes employment with New York State or any of its subdivisions should know that such employment could affect your retirement allowance.
While there have been no major changes in the last year, some of the numbers have changed. Be sure to read through carefully so that you do not jeopardize your retirement allowance.
A law which only applies to service retirees and which has been renewed periodically for the past several years establishes three categories of retired employees who may work in public service in New York State without penalty.
First category: A retiree working for the New York City Department of Education may earn the difference between his or her maximum retirement allowance and the salary that could be earned on the job had the person not retired, with such difference raised to the next higher multiple of $500.
A retiree must have the approval under the 211 waiver from the chancellor, based on a finding that:
Such approval may not exceed one year. Excess earnings, if any, are deducted from the retirement allowance.
Second category: a retiree working for a different public employer has no limitations on earnings. The same approval as outlined above is required.
Third category: Amendments to the law have been passed permitting a retiree under 65 years of age to earn up to $30,000 in 2007 in New York State public service without the need for prior approval.
In 2006, retirees could earn up to $27,500. The amount allowed for 2008 has not been determined. You must file a statement (Form 212) with the retirement system to the effect that the retiree elects to have the provisions of the law apply. If you earn more than the maximum amount, the law requires that your pension payment be discontinued.
No pension credit may be granted for post-retirement service under this law.
How your Social Security benefits are affected: A retiree from 62 to full retirement age may earn up to $13,560 in 2008 without affecting Social Security benefits. If a retiree earns more than this amount, he or she will lose $1 in Social Security benefits for every $2 earned.
A retiree who is full retirement age (65 and 10 months in 2008) or older faces no limitations on earnings.
There is a special earnings test in the year one reaches full retirement age. In 2008 it is $36,120 a year — $3,010 per month. Earnings above the limit will reduce Social Security by $1 for every $3 earned.
Since these figures increase periodically, it is up to you to keep informed of any changes. Check with the Social Security office at 1-800-772-1213 from anywhere in the United States.
A note about your union dues: When you return to work for the city’s Department of Education and continue to collect a pension, you will find that you are paying union dues both as a retiree (from your pension check) and as an employee (from your payroll check). This duplication occurs because two separate agencies are involved. The Department of Education does not know that you are retired and it automatically deducts dues from every employee represented by the UFT. You are entitled to a refund of the lesser dues amount.
F-status note: If you are F-status, please be aware that the vacation pay you earn will be counted as part of your allowable earnings.