Arizona State, Major City & Public School Retirement Systems

The ASRS Defined Benefit Plan is the primary plan for ASRS members and provides lifelong benefits upon retirement. The ASRS pension is built through a cost-sharing model. Both the participant employee and the ASRS employer contribute towards retirement, but the participant’s contribution funds only a relatively small part of the benefit. When he or she retires, the participant recovers his or her contributions within approximately three to five years from the start of payments. Employer contributions and earnings on the investments of ASRS funds are used to provide the remainder of the lifelong retirement benefit payments.

The ASRS is tax qualified under section 401(a) of the Internal Revenue Code. Member contributions to the ASRS are exempt from federal income tax withholding under section 401(h) of the Code. The tax on benefits and contributions is deferred until payment is made to the member as a benefit or refund.

A worker may transfer credited service to or from the ASRS and the following systems: the Elected Officials Retirement Plan (EORP), the Public Safety Personnel Retirement System (PSPRS), the Correctional Officer Retirement Plan (CORP), the City of Phoenix Employees Retirement System (COPERS), and the City of Tucson Supplemental Retirement System (TSRS). Learn more by reading our FAQs below.


STATE PLANS:


QDRO Arizona State Retirement System (ASRS)
(Domestic Relations Order - Based on Arizona State Law)
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QDRO Correctional Officers Retirement Plan (CORP)
(Domestic Relations Order - Based on Arizona State Law)
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QDRO Elected Officials’ Retirement Plan (EORP)
(Domestic Relations Order - Based on Arizona State Law)
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QDRO Public Safety Personnel Retirement System (PSPRS)
(Domestic Relations Order - Based on Arizona State Law)
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QDRO Supplemental Defined Contribution Plan (SDCP)
(Domestic Relations Order - Based on Arizona State Lawr)
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CITY PLANS:


QDRO Phoenix Employee Retirement System (PERS)
(Domestic Relations Order - Based on Arizona State Law)
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QDRO Tucson Supplemental Retirement System (TSRS)
(Domestic Relations Order - Based on Arizona State Law)
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Frequently Asked Questions:

Q. What is the Total Credited Service?
A. The Total Credited Service is the period of employment during which the participant makes contributions to the ASRS – plus any service purchased and credited to his or her account. Credited service is the amount of credit – in years and months – applied toward the retirement formula.
Q. Must a participant share his or her ASRS benefits in a divorce?
A. Yes. If a participant married during any time that he or she actively contributed to ASRS, his or her spouse may be entitled to a portion of the participant’s account or retirement benefit in a divorce. Because Arizona is a community property state, property acquired during a marriage belongs to the community of the marriage, not to an individual as that person’s separate property. This means that all or a portion of an ASRS account or benefits may be a community property asset.
Q. Does a former spouse remain the beneficiary if designated before the divorce?
A. No. Under Arizona law, divorce revokes the designation of the spouse as beneficiary. In the event of a divorce, the ASRS automatically nullifies the divorced spouse as a beneficiary. The member should select a new beneficiary upon divorce, even if it is to rename the former spouse as a beneficiary.
Q. How are monthly benefits calculated?
A. The ASRS provides a fixed monthly benefit upon retirement, determined by a formula. The benefit formula is based on the length of service (credited service) under the ASRS, multiplied by a percentage of the average monthly amount of earnings (compensation). For example, the period of employment during which the participant makes contributions to the ASRS - for example 20 years - is multiplied by a percentage set by statute. This is based on your total years of service at retirement – for example 2.15. This is multiplied by one of two calculation methods: the 36-month or 60-month calculation.
Q. What are the calculation methods?
A. 36 Months: membership date prior to July 1, 2011, which uses the highest consecutive 36 months of contributions within the last 120 months (10 years) of contributions reported and excludes termination pay.

60 Months: membership date prior to January 1, 1984, which uses the highest consecutive 60 months of contributions within the last 120 months (10 years) of contributions reported. Payments made as a result of termination of employment (Termination Pay), such as vacation/annual leave, sick leave, termination incentive payments, etc., are included in the calculation, with exceptions.

Membership Date on or after July 1, 2011, which is calculated by taking the highest consecutive 60 months of uses contributions within the last 120 months (10 years) of contributions reported and excludes termination pay.

Q. What should a participant think about in selecting a retirement annuity?
A. A participant has a number of options for choosing an annuity or pension benefit. Generally, retirees consider how much of a benefit they desire and whether they want to leave a benefit to someone when they die.

The maximum benefit is the Straight Life Annuity. This selection provides the fullest benefit, with no guaranteed benefit continuing to a beneficiary once the participant dies. The period certain and joint and survivor options provide for a continuation of benefits to a beneficiary, who is normally a spouse or former spouse.

Q. How does a participant decide which annuity to choose?
A. Here are the types of annuities:

Straight Life Annuity: provides the maximum in a monthly benefit for life. If the participant dies before all of the contributions plus interest have been paid, the remaining balance is paid to the beneficiary, which in a divorce is the alternate payee. This is the base benefit from which all other options are derived.

Life Annuity 5-Year Certain: provides a reduced monthly benefit for the duration of the selected term. If the participant dies before receiving 60 monthly payments, the ASRS pays the remaining payments to the beneficiary until all 60 have been made. The retiree must be age 103 or younger.

Life Annuity 10-Year Certain: provides a reduced monthly benefit for the duration of the selected term. If the participant dies before receiving 120 monthly payments, the ASRS pays the remaining payments to the beneficiary until all 120 have been made. The retiree must be age 92 or younger.

Life Annuity 15-Year Certain: provides a reduced monthly benefit for the duration of the selected term. If the participant dies before receiving 180 monthly payments, the ASRS pays the remaining payments to the beneficiary until all 180 have been made. The retiree must be age 84 or younger.

Joint and Survivor 100%: provides a reduced monthly benefit for life. Upon the death of the participant, ASRS pays 100% of the monthly benefit to the beneficiary for the rest of his or her life. You may choose this option if your beneficiary is your spouse or a non-spouse who is not more than 10 years younger than the participant.

Joint and Survivor 66 2/3%: provides a reduced monthly benefit for life. Upon the death of the participant, the ASRS pays a benefit to the beneficiary for the rest of his or her life. The payment to the beneficiary will be equal to 66 2/3% of the participant’s monthly benefit. The participant may choose this option if the beneficiary is a spouse or a non-spouse who is not more than 24 years younger than you.

Joint and Survivor 50%: provides a reduced monthly benefit for life. Upon the death of the participant, the ASRS pays a benefit to the beneficiary for the rest of his or her life. The payment to the beneficiary equals to 50% of the participant’s monthly benefit. There are no age restrictions for the beneficiary.

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