Eligibility
Throughout members’ employment, their pre-tax contributions accumulate in the trust fund along with interest credited at the rate of two percent (2%). We hold member contributions in the trust for the sole benefit of the individual members. When members retire, we use the contributions to help pay their monthly retirement benefit. If members terminate employment before they retire, they can request a refund of their accumulated contributions.
When members receive a refund, they forfeit [lose, give up] the credited service associated with the contributions. Forfeiting the credited service means that members will not receive any benefits – lump sum, monthly, or otherwise – in the future for that service. As a result, members should consider their long-term needs when deciding whether to receive a refund of contributions now.
Benefits
Members who request a refund must decide how to receive their payment. Refunds of contributions are eligible for rollover. A rollover is a payment to another eligible employer plan or an individual retirement account (IRA) that allows members to continue to postpone taxation.
Members can receive their refund in two ways:
- Paid in a direct rollover
- Paid to the member
Key Features
Paid in Direct Rollover
- We mail the payment directly to the rollover institution.
- We are not required to withhold federal and state taxes.
- Members pay taxes later when they take the funds out of the rollover plan.
Paid to the Member
- We deposit the payment directly to a financial institution account.
- We are required to withhold 20% for federal income tax and 5% for Arkansas state income tax.
- Members may also face an additional 10% tax if they receive the payment before they reach age 59 ½.
Application
Members can request a refund after their employment has been terminated for 30 days. Employers add a termination date to our records when they report and remit the final member contributions.
Members can apply for a refund in two ways:
- myAPERS Portal
- Termination Refund Application
Key Features
myAPERS Portal
- Apply electronically in the myAPERS Portal
- View contribution balance
- Receive immediate confirmation of submission
- Receive immediate confirmation of payment date
Termination Refund Application
- Use the Contact Us page to request that we mail a Termination Refund Application.
- Requires notary acknowledgement
- Receive confirmation letter when refund processed
Application Processing
We process refunds within 30 days of our receipt of a refund request. We issue payments on the 1st and 15th of each month based on the following receipt date:
| APERS Received Date | Payment Date |
|---|---|
| 1-15 | 1st of following month |
| 16-31 | 15th of following month |
Example:
- If we receive your refund request on January 14, we will issue your refund on February 1.
- If we receive your refund request on June 30, we will issue your refund on July 15.
Frequently Asked Questions
Why do I have to wait 30 days after I terminate?
We refund contributions in a single lump sum, and we must wait until we receive final member contributions from employers. Employers often issue paychecks in arrears, and retirement law allows employers time after they issue paychecks to send the contributions to us. The 30-day timeframe allows us to confirm employment has ended and to receive and reconcile all contributions.
Can my refund be expedited?
After the 30-day period has passed, former members can expedite their refund by applying electronically in the myAPERS Portal instead of applying with the Termination Refund Application.
Will I receive my employer’s contributions also?
Employers pay contributions as a percentage of their active member payroll, which means the contributions are not credited to individual members. Employer contributions help cover the cost of lifetime monthly benefits for members who retire; members who do not retire do not receive employer contributions.
Can I elect for taxes not to be withheld?
Federal and state laws allow members to make contributions on a pre-tax basis to help them save for retirement. These laws also require the system to withhold taxes when we issue refunds of the pre-tax contributions. To continue to defer taxation, members can elect to have their refund paid in direct rollover to another employer plan or an IRA instead of paid directly to them.
Resources
- Guide: How To – Register for myAPERS
- Guide: How To – Request a Refund
- Publication: Special Tax Notice Regarding Plan Payments
- Publication: Vesting and Benefit Notice