For Members Nearing Retirement– Protection Occupations Important Information About Your IPERS Retirement Benefits

In the Event of the Unexpected

Disability Benefits
If you qualify for disability benefits from IPERS, your benefits can begin before the age you would normally be eligible for benefits and will not be reduced for early retirement. You may have a choice between two types of disability benefits: Special Service disability benefits and regular IPERS disability benefits.

Special Service Disability Benefits

To be eligible for Special Service disability benefits, you must meet all of the following conditions:

• Are vested.
• Apply for benefits within 1 year after terminating IPERS-covered employment.
• Complete a medical exam by the Medical Board of the University of Iowa.

You may qualify for Special Service disability benefits even if you are not receiving federal disability benefits. If IPERS determines that you qualify, you will receive an estimate of the benefits for which you are eligible. Disability payments you receive from social security, long-term disability insurance, workers’ compensation, unemployment insurance, and employer-paid disability benefits for the same disability will reduce the amount of disability benefits you may receive from IPERS. You will need to provide complete copies of your state and federal tax returns every year.

If you return to IPERS-covered employment after beginning to receive Special Service disability benefits, benefits will stop immediately. If you return to non-IPERS-covered employment, benefits may be limited.

Regular Disability Benefits
If you receive social security disability or railroad retirement disability benefits, you may be eligible for disability benefits from IPERS even before age 55.

To qualify for disability benefits, you must meet all of the following conditions:

• Have ended all IPERS-covered employment.
• Be vested.
• Be receiving federal social security or railroad retirement disability benefits.
• Apply for benefits. You must indicate on your application for IPERS retirement benefits that you are retiring due to a disability.

If you return to covered employment after beginning to receive IPERS disability benefits and before you attain age 55, your benefits may be suspended or reduced.

Choosing Between Special Service Disability Benefits and Regular Disability Benefits
Unlike regular members, you may have a choice between two very different types of disability benefits. Here is a brief description of some of the major differences.

One of the major differences is taxability. Generally, Special Service disability benefits are nontaxable, if your disability resulted from an in-service injury. However, even Special Service benefits are taxable if you choose benefit payment Option 2. If you have a substantial amount of service credit, you may find that the regular disability benefits, even though taxable, provide the larger net amount. Death benefits payable to your beneficiary(ies) will receive the same tax treatment that you were receiving.

If you retire with Special Service disability benefits, you may qualify for up to 6 months of retroactive benefits. However, if you retire with regular disability benefits, you may qualify for up to 36 months of retroactive disability benefits.

If you retire with Special Service disability benefits and later qualify for social security disability benefits, you have 60 days to convert your Special Service disability benefits to regular IPERS disability benefits, if you decide that is a better choice. The switch is irrevocable. A member who first retires with regular disability benefits cannot switch to Special Service disability benefits.

Finally, Special Service disability benefits are subject to an offset for workers’ compensation, unemployment, and employer-paid disability benefits, whereas regular disability benefits are not.

As you can see, there are many variables to consider when choosing whether to apply for Special Service disability benefits or regular disability benefits. Although IPERS representatives cannot make the choice for you, we can help you make an informed choice based on your personal situation.

Death Benefits
If You Die Before You Start Receiving Benefits
IPERS provides death benefits in the event that you die before beginning to receive your IPERS benefits. How IPERS pays out the benefits depends on how you designate your beneficiary(ies).

• If you have only one beneficiary designated, your beneficiary may choose between a lump-sum payment or a lifetime monthly payment, when eligible (provided the monthly benefit is $50 or more).
• If you have more than one individual listed as a beneficiary or your designated beneficiary is an estate, trust, church, charity, or other similar organization, your beneficiary(ies) will receive only a lump-sum payment.

In addition, your beneficiary(ies) may be eligible for a line-of-duty death benefit payable if you die on the job. This benefit is payable as a lump-sum payment.

If You Die After You Start Receiving Benefits
Your beneficiary(ies) may receive a death benefit if you die after retirement, depending on the payment option you elected when you retired.

For more specific information about the type of benefit your beneficiary will receive, please refer to Your Payment Options.