Purchasing Service Maximizing Your IPERS Benefits

How to Purchase Service

Complete the Application for Service Purchase. Completing the application does not obligate you to purchase service. Completing the application is the only way you can find out how much your service purchase would cost.

Cost quotes are valid for 6 months. If you request more than one cost quote within a 6-month window, IPERS will use the most recent cost quote and all previous cost quotes will become invalid. Your cost quote will include an expiration date. Service purchase payments must be postmarked by the expiration date on the cost quote.

You can purchase all or a portion of your qualified service. For example, if you are eligible to purchase 2 years of service (8 quarters), you can purchase any amount from 1 quarter to all 8 quarters. You may purchase all of your service credit at one time, or in quarter-year increments. However, service purchases made in a calendar year cannot exceed a limit set by the federal government ($46,000 in 2008), unless you roll over money to IPERS from another retirement account or buy back IPERS service. There is no limit on the amount you can spend in a calendar year when you buy back IPERS service or when you roll over money from another retirement account to purchase service.

Keep in mind that completing the Application for Service Purchase does not mean that you are obligated to purchase service.

Although the amount you wish to purchase may be within the dollar limits described above, your service purchase cannot increase your IPERS benefits beyond the IRS limit on annual benefit payments and may be limited accordingly.

Allow IPERS at least 4 to 6 weeks to process a service purchase application.

Using Rollover Money to Purchase Service

If you have money in another retirement plan or account, you may be able to use that money to purchase IPERS service credit. This is called rolling over money to IPERS.

IPERS only accepts rollover money from certain types of retirement plans including:

• 401(a) and 401(c) qualified plans.
• IRA accounts and annuities.
• 403(b) tax-sheltered annuities.
• Governmental 457(b) plans.

If you have money in another retirement plan or account, confirm with your retirement plan administrator the type of plan it is. Remember, the federal government does not limit how much you can purchase in a calendar year by rolling over money to IPERS.