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Indiana Public Retirement System

Indiana Public Retirement System (INPRS) > My Fund > Excise > State Excise Police, Gaming Agents and Conservation Enforcement Officers' Handbook State Excise Police, Gaming Agents and Conservation Enforcement Officers' Handbook

In 1972, the Indiana Legislature established what is now known as the State Excise Police, Gaming Agent, Gaming Control Officer and Conservation Enforcement Officers’ Retirement Plan. The purpose of this plan is to provide retirement, disability and survivor benefits for the following agencies:

  • Department of Natural Resources,
  • Alcohol and Tobacco Commission, and
  • Indiana Gaming Commission employees who engage solely in law enforcement duties.

On July 1, 2005, the Indiana State Legislature added Gaming Agents to this plan.

Membership (IC 5-10-5.5-5)

If you were a state excise police or conservation enforcement officer on Sept. 2, 1971, joining this plan was optional. You were allowed 20 days prior to Sept. 2, 1971 to file a written notice with the Public Employees' Retirement Fund (PERF) if you elected not to join. Your decision not to join the plan was final.

All state excise police and conservation enforcement officers hired after Sept. 2, 1971 must join the plan. Membership in the plan is a condition of employment.

Contributions

Employee: As a member, you put in 4 percent of your yearly pay. The 4 percent is taken out of your payroll. Your portion is placed in your member account.

Employer: The state of Indiana pays the earned benefit. The actuary decides the amount of the benefit. The INPRS Board of Trustees decides the employer contribution rate. The employer’s portion is based on the suggestions of our actuary.

The amount credited to your account equals the value of your portion plus interest valued the day before you apply for a distribution, or the date of your death plus contributions received after that date. You must:

  • have ended service,
  • died before vesting, or
  • be the survivor of a deceased member.

The interest rate for employees will be set at least yearly when crediting interest on employee contribution accounts. If you are an active member, your interest will be credited, at least yearly, based on the prior fiscal year end balance.

You will not receive interest credit if you have less than 20 years of service and no activity on your account after 10 years.

Beneficiary Elections

You may choose a beneficiary and a contingent beneficiary by completing the proper form. If you are a new member, you may choose a beneficiary on your member record form.

You must fill out this form if you want to change your beneficiary. A contingent beneficiary may also be elected on the form (see IC 5-10-5.5-15 for the list of eligible beneficiaries).

Service Credit

  • If you received state disability benefits, you may receive service credit for that time.
  • Your military service credit and PERF credit grows and is calculated and credited the same way.
  • You may purchase service credit under the terms of this plan (IC 5-10-5.5-7.5).

Your total service credit equals all your creditable service in the fund, including partial years. Your benefit is calculated based only on whole years.

Benefits

You must retire at age 65 if you are an excise police officer, gaming agent, gaming control officer or conservation officer who became a member in the plan before age 50.

If you are an officer who became a member after age 50, you must retire the earlier of:

  • the first day of the month after your  65th birthday, or
  • the first day of the month after you complete 15 years of service.

A normal retirement benefit is 25 percent of your average yearly pay. You will receive 1.66 percent of your average yearly pay for every completed year of creditable service past 10 years. Your  "average annual salary" means your average yearly pay during the five years of your highest pay in the 10 years just before you leave service. This is defined under IC 5-10-5.5-1. Pre-tax pay reduction agreements are not considered in this calculation (under Internal Revenue Code Section 125).

If you end service before you turn age 45 and you have 15 years or more of creditable service, you do not qualify for a retirement benefit. You will qualify to choose a retirement benefit when you turn 45. The benefit at age 45 is reduced for early retirement. If you become a member of the plan after age 50 and you have 10 years or more of creditable service, you may choose an unreduced retirement benefit when you end service.

Benefit Overpayment or Underpayment

INPRS is required by federal and state law to correct any errors in benefit calculations. If you receive an overpayment as a result of an error, INPRS must recover the overpayment. If you are underpaid, you will receive an additional payment from INPRS.

Deferred Retirement Option Plan (DROP)

Effective July 1, 2008, a Deferred Retirement Option Plan (DROP) is set up for all plan members.

If you are qualified to retire and begin drawing unreduced benefits, you may enter DROP and choose a retirement date. The guidelines of the plan are used to decide if you qualify to enter DROP.

DROP retirement benefits are based on your:

  • average yearly pay, and
  • years of creditable service; on the date you enter DROP.

As a DROP member, you must agree to:

  • make a binding decision to retire on your DROP retirement date, and
  • remain in active service until your DROP retirement date,
  • continue to contribute to the plan under the terms of the plan while in DROP,
  • choose a DROP retirement date that is between 12 months and 36 months from the date you enter DROP,
  • exit DROP when you reach the retirement age set in the plan, and
  • enter DROP only one time in your lifetime.

If you retire on your DROP retirement date, you will receive a yearly retirement payment that:

  • is calculated as if you had never entered DROP, or
  • includes your DROP frozen benefit, plus a second amount paid as you choose,
  • this is decided by multiplying your DROP frozen benefit by the number of months you were in DROP. The additional amount is paid in one of the following ways:
    1. a lump sum paid on:
      1. your DROP retirement date, or
      2. the date you retire because of a disability.
    2. three equal yearly payments:
      1. beginning on:
        1. your DROP retirement date, or
        2. the date you retire because of a disability, and
      2. afterwards paid on:
        1. the anniversary of your DROP retirement date, or
        2. the date you retire because of a disability.

Disability benefits if you elect DROP

If you become disabled (as decided by the INPRS Board of Trustees or its designee), while in DROP, your yearly benefit is calculated as follows:

  • If you retire because of a disability in less than 12 months of the date you enter DROP, your benefit is calculated as if you had never entered DROP.
  • If you retire because of a disability 12 months or more after the date you enter DROP, your benefit is calculated as a DROP benefit. Your retirement date is the date you retire because of a disability, not your DROP retirement date.

DROP survivor benefits

If you die before your benefits begin, death benefits will be paid to your surviving spouse. Your spouse will receive a calculated lump sum DROP benefit. If you do not have a surviving spouse, the lump sum will be divided equally among your surviving children. If you do not have surviving children, the lump sum is paid to your parents. If you do not have surviving parents, the lump sum is paid to your estate.

A benefit is paid on the DROP frozen benefit under the terms of this plan.

While you are in DROP, cost of living increases will not apply to your DROP frozen benefit. After you retire on your DROP retirement date, cost of living increases will apply to your yearly benefit. The Indiana General Assembly decides the rate of your cost of living increases.

For more information about DROP for this plan, please contact (888) 286-3544.

Early Retirement (IC 5-10-5.5-11 and 12)

You qualify for early retirement if you are:

  • age 45 and have earned at least 15 years of creditable service, (reduced benefit)
  • at least age 55 and your age plus years of service equal 85, or are (unreduced benefit)
  • at least age 50 and have earned at least 25 years of service. (unreduced benefit)

A reduced benefit and a regular benefit are calculated the same way. However, the plan deducts 0.25 percent for each full month that your early retirement date precedes your 60th birthday.

Disability Benefits

A request for disability benefits may be made by you, the department or the commission. The INPRS Board of Trustees, or its designee, will decide:

  • if your disability meets statutory requirements,
  • the degree of your disability, and
  • if the disability arose in the line of duty (as defined in the statute).

When you file for disability benefits, the INPRS Medical Authority will use the impairment standards of the United States Department of Veterans Affairs’ Schedule for Rating Disabilities to decide the degree of your impairment. The USDV standard in effect at the time you file will be used to decide the degree of your disability.

You may receive disability benefits (as decided by the INPRS Board of Trustees or its designee) in the amount provided by this retirement plan if:

  • you become unable to perform all suitable and available work on the force, and
  • reasonable accommodations (required by the Americans with Disabilities Act) are made, and you remain unable to perform work that you are qualified for or may become qualified for.

Disability benefits will not be provided for any disability that:

  • is intentional or self-inflicted injury or attempted suicide while sane or insane,
  • results from a committed or attempted felony act,
  • begins within two years after you enter or re-enter active service on the force and
  • is a mental or physical condition that began before you entered or re-entered active service.

If your disability begins while in the line of duty, you may receive a monthly benefit that equals your monthly pay on the date of your disability. The amount is multiplied by the degree of your impairment (expressed as a percentage of you as a whole). The monthly benefit must be at least:

  • 20 percent of your monthly pay as of the date of your disability if you have more than five years of service, or
  • 10 percent of your monthly pay as of the date of your disability if you have five years or less of service.

A disability is considered in the line of duty if the disability is the direct result of a:

  • personal injury that happens while you are on duty,
  • personal injury that happens while you are off duty and responding to:
    1. an offense,
    2. an emergency, or
    3. a reported offense or emergency.
  • an exposure risk to disease according to state law (IC 5-10-13) while in the line of duty.

If your disability did not happen in the line of duty, you are entitled to a monthly benefit equal to 50 percent of your monthly pay on the date of your disability. The amount is multiplied by the degree of your impairment (expressed as a percentage of you as a whole). The monthly benefit must be at least:

  • 10 percent of your monthly pay on the date of your disability if you have more than five years of service, or
  • 5 percent of your monthly pay on the date of your disability if you have five years or less of service.

Survivor Benefits

If you die after you have earned 15 or more years of creditable service under the plan, your elected beneficiary is entitled to receive survivor benefits. You may elect any one of the following individuals as your beneficiary:

  • your spouse,
  • your unmarried child or children under age 18, or
  • your surviving parent

If you elect your spouse as your beneficiary, he or she is entitled to a monthly survivor benefit for life. This benefit is equal to 50 percent of the amount that you would have received under the plan. If your spouse is more than five years younger than you, the survivor benefit is actuarially reduced.

If you elect an unmarried child under the age of 18 to receive your survivor benefits, that child is entitled to a monthly survivor benefit until he or she reaches age 18 or marries, whichever occurs first. This benefit will equal 50 percent of the amount you would have received under the plan.

If you name more than one child to receive your survivor benefit, the benefit is divided equally between all of the elected children. Benefits will end when a child turns age 18 or marries. The survivor benefit will then be divided equally between the remaining children who still qualify for benefits.

If you elect a parent as your beneficiary, the parent will receive a monthly survivor benefit for life. This benefit equals 50 percent of the amount you would have received under the plan.

If you do not elect anyone to receive your survivor benefit, or those elected precede you in death, your estate will receive a lump sum payment of your contributions and earned interest.

A lump sum payment will not be paid to the estate of your last surviving beneficiary if you and your beneficiary die prior to recovering contributions plus interest.

You can log in to your account to manage your personal and pension benefit information. You will need your Social Security number (SSN) and passcode to get started. If you do not have your SSN or passcode, call our office at (888) 286-3544.

Distributions

You do not qualify for retirement benefits if you:

  • have less than 15 years of service when you end employment, or
  • become a member of the retirement plan after age 50 and have less than 10 years of service.

You may handle your account in one of three ways if you do not qualify for benefits.

Choice A:

If you end service before you earn 15 years of service and then become a member of PERF, you may transfer your creditable service to that plan. If you transfer your account and service credit to PERF, you qualify for PERF retirement benefits when you:

  • turn age 65, and
  • have 10 years or more of creditable service.

You give up your service credit and the right to transfer this service credit to PERF if you are not vested at the time you withdraw your contribution account. If you cancel this service, your decision is final.

Choice B:

You may leave your account balance with the plan. If you leave your balance with the plan, you will receive the same interest rate as the PERF Guaranteed Fund rate.

Choice C:

You may choose to receive a distribution of your account (See the Distribution of Member Contributions section below).

You are entitled to a lump sum distribution of all your contributions and earned interest if you:

  • end employment before you earn 15 years of creditable service and you are not age 45, or
  • become a member of the retirement plan after age 50 and have less than 10 years of service.

IRS regulations state that you may not receive a distribution from your account if you transfer to another position with the state of Indiana. You will only receive a distribution of your account (your contributions and earned interest) when you have ended employment with the state of Indiana.

Your account will receive eligible interest credit when you elect a distribution. The credit amount is set by the laws in effect at the time of the distribution.

When you are vested, your account combines with your retirement benefit to fund your retirement. You will not be able to elect a distribution if you:

  • are vested with at least 15 years of service, or
  • become a member after age 50 and you have at least 10 years of service.

If you die before you have earned 15 years of creditable service and you have not named a beneficiary, your contributions and earned interest will be paid to your estate.

If you are not vested, you will not receive the employer contributions under any circumstances. The employer contributions fund your benefits once you qualify for retirement or disability.

If you end employment after you earn 15 years of creditable service but you do not qualify for benefits, you will not receive your contributions and interest. You will qualify once you:

  • reach age 45 (early retirement benefits), or
  • reach age 60 (normal retirement benefits), or
  • meet the requirements of IC 5-10-5.5-11,
  • join the retirement plan after age 50 and earn 10 years or more of creditable service.

Distribution of Member Contributions

You may withdraw your member contributions and earned interest if you qualify for a distribution under the plan. Your distribution options are:

  • distribution paid directly to you, or
  • direct rollover.

Income Tax Consequences

Payment Directly to You
You will have 60 days to roll over your member contributions to a traditional Individual Retirement Account (IRA) or an eligible employer plan that accepts rollovers. If you do not roll over your contributions in 60 days, the taxable portion will be subject to a mandatory 20 percent federal income tax withholding (state tax withholding may also apply). The distribution is taxed in the year you receive it.

If you receive a distribution of your contributions before age 55 and you do not roll it over, you may have to pay an early distribution tax penalty equal to 10 percent of the taxable portion of the payment in addition to the regular income tax.

If you are a qualified public safety employee who is at least age 50 and you are receiving a distribution from a governmental defined benefit plan, you will not have to pay the early distribution tax penalty equal to 10 percent.

To request a distribution, you can log in to your your account. You may also call (888) 286-3544 to speak with a customer service representative.

Direct Rollover
A direct rollover is a direct payment of some or all of your member contributions to:

  • a traditional IRA, or
  • an eligible employer plan (such as a 403(b) tax sheltered annuity, a 457 deferred compensation plan), or
  • a 401(a) qualified plan that will accept the rollover.

You can elect a direct rollover of all or a portion of your eligible distribution. You will not be taxed on your direct rollover amount until you withdraw the funds from the rollover account. There is no income tax withholding on the amount you roll over.

To request a distribution, you can log in to your account. You may also call (888) 286-3544 to speak with a customer service representative.

Retirement Benefits

When you retire, you will be taxed on all of your benefit payments you receive. Your "tax basis" portion will not be taxed. The tax basis is the 4 percent member contribution that was taxed when the contribution was paid into the plan. Over a pre-decided number of payments, you will recover your non-taxable (tax basis) amount from each benefit payment. Your recovery amount is based on your age at the time your benefits start. The schedule for repayment is set by IRS regulations. After all the non-taxable amounts have been left out of your benefit payments, 100 percent of the remaining benefit payments will be included as taxable income. Each year, the plan will provide you with a 1099-R form to report the taxable and non-taxable (if any) portion of your benefits.

Tax Withholding

The plan is required to withhold income taxes on distributions and monthly payments. You may elect not to have taxes withheld. Make sure to complete the tax withholding forms when you apply for benefits.

CAUTION: You should talk to the trustee of your qualified plan or IRA or your professional tax advisor if you need more information about the taxes on your distribution.

The Administrative Review Process

Appeals of the plan initial determination will be heard by an Administrative Law Judge in compliance with the Indiana Administrative Orders and Procedures Act IC 4-21.5.

To request administrative review, you must have rights as a party or a right to intervene. The steps of administrative review are here.

All parties will have the chance to present additional evidence during the appeal process. The Administrative Law Judge will submit findings to INPRS. INPRS will review the findings of the Administrative Law Judge and issue a final determination.

All parties will be informed of the final determination.


Every attempt has been made to verify that the information in this handbook is correct and up-to-date. Published content does not constitute legal advice. If a conflict arises between information contained in this publication and the law, the applicable law shall apply.