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IPERS Deductions

Up to six IPERS retirement deduction codes will be used to sum each employee's quarterly salary that was subject to the retirement deductions. The deduction codes for IPERS deductions must match the deduction codes listed on the Human Resources Profile - State page.

You must create the six retirement deduction codes, or whatever is applicable, and set their maximum deductions/benefits and amount/rate similar to the following examples:

A. Three deduction codes for the 403(b) or 401(k) retirement plan:

4031: Elective Deferral code:

- Maximum deduction = 11,000

- Maximum benefit = Depends on each employee income, thus it can be set using each employee’s deduction screen:

If an employee income is greater than or equal to 40,000,

Then his/her Maximum benefit is = $ 29,000

(40,000 – 11,000 = 29,000)

Otherwise, it is = (100% of employee compensation – 11,000)

4032: Catch-up code – Maximum deduction = 1,000.

4033: 15-Years’ Service code – Maximum deduction = 3,000.

B. Three deduction codes for the 457(b) retirement plan:

4571: Elective Deferral code - Maximum deduction = 11,000

4572: Catch-up code – Maximum deduction = 1,000.

4573: 3-Years-to-retire code – Maximum deduction = 22,000 (Double the amount of 4571 code)

The deduction codes themselves (4031, 4032, 4033, 4571, 4572, and 4573) are only examples of what users may choose to use. The amounts may not be current and must be verified with IPERS.

If an employee is retired, the employer can still contribute to their benefit under plan 403(b) for five years after retirement. In this case, the user must change the maximum deduction/benefit amounts of the Elective Deferral deduction code (code 4031) for that employee only. Also, you must adhere to the rest of the payroll system setup for that employee.

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