Overview
MTRS member contribution rates are established pursuant to M.G.L. c. 32, §22. For members of the MTRS, employers are responsible for deducting the mandated percentage from their employees’ regular compensation and forwarding those contributions to the MTRS for deposit. Once an employer has registered a member in MyTRS, the appropriate deduction rate can be found in MyTRS under Employee Roster.
MTRS members’ contribution rates are determined by a combination of two factors:
- the employee’s RetirementPlus status, and
- if the employee is not participating in RetirementPlus, the date on which the employee most recently became eligible for membership in a Massachusetts contributory retirement system and from which he or she continuously maintained his or her funds on account. Most of our members will establish membership in a contributory retirement system on the date they start working as a public employee in Massachusetts.
Unless they are transferring into the MTRS from another Massachusetts contributory retirement system (see below), employees who join the MTRS after 7/1/2001 are mandated to contribute at 11% and participate in RetirementPlus [M.G.L. c. 32, §5(4)].
When a member changes districts, or takes a refund
| If a member... | Then... |
|---|---|
| Changes employers (for example, leaves the Cambridge Public School system to teach in the Springfield Public School system) | There is no change in his or her contribution rate, RetirementPlus status, or Membership Tier. |
| Leaves active service and: | |
| If and when the member later returns to service, there is no change in contribution rate, RetirementPlus status, or Membership Tier. |
| He or she will lose all membership rights. If the member later re-establishes MTRS membership, he or she is required to contribute at the new member rate (currently 11%), and participate in RetirementPlus. Members can buy back refunded service, however, this will not reinstate the member’s prior membership date, contribution rate, or, if applicable, prior Tier 1 status. |
When a member transfers into the MTRS from another Massachusetts contributory retirement system
Members who join the MTRS and have funds on account with another Massachusetts contributory retirement system are existing retirement system members who are required to transfer their retirement system membership, tier and service to the MTRS pursuant to M.G.L. c. 32, §3(8). The guidelines for determining contribution rates for transferring members are a little more complicated, but be assured that we will gladly help you and our members understand the rules. If a member has questions regarding their rate or RetirementPlus election, please do not advise them; instead, direct them to contact the MTRS.
Please note these guidelines regarding members who transfer in:
- All new members of the MTRS who transfer into the system on or after July 1, 2022, and whose prior service in another Massachusetts public retirement system began on or after July 1, 2022, pursuant to Chapter 134 of the Acts of 2022, are required to participate in the R+ program. Like all other new teachers, these members are mandated to participate and have no election option.
- For members who transfer in service from another retirement system rendered prior to July 1, 2022, the initial contribution rate will automatically be defaulted to the RetirementPlus rate of 11%. Once we confirm that the other retirement system has funds and service on account that qualify the member for either a RetirementPlus election or a lower, grandfathered contribution rate, we will place the member’s rate and RetirementPlus status on-hold (the on-hold status will appear in two places: in your deduction exception report, and in the View/Update Employee Information window in MyTRS). The member will remain on-hold during the 180-day RetirementPlus election period, which starts when we receive the transfer. Members who are entitled to an election will default into RetirementPlus participation, but will have an opportunity to “opt-out” of participation in the program.
- If the member established his or her contribution rate with:
- A Massachusetts contributory retirement system OTHER than the Boston retirement board, and transfers into the MTRS on or after July 1, 2001 with other MA service rendered prior to July 1, 2022, he or she will have a one-time RetirementPlus election period that is 180 days from the date that the MTRS first receives the member’s transfer of service and funds. If he or she then:
- EITHER makes an affirmative election to participate in RetirementPlus OR fails to return his or her election from by the deadline, his or her contribution rate will be the RetirementPlus rate of 11%.
- Opts to not participate in RetirementPlus, then his or her retirement contribution rate will be the rate established with the previous retirement system.
- the Boston retirement board, and he or she was:
- eligible for the Teachers’ Alternate Retirement Plan (TARP), and
- either elected to participate in TARP or was mandated to participate in TARP; or,
- elected not to participate in TARP or defaulted out of TARP
- then he or she will retain his or her TARP status upon transferring to the MTRS. In other words, if the person participated in TARP, he or she will automatically participate in RetirementPlus; if he or she did not participate in TARP, then he or she will not be given a RetirementPlus election opportunity, will not contribute at 11%, and will not be eligible to participate in RetirementPlus.
- ineligible for any TARP consideration (for example, he or she was not eligible based on his or her position and title), he or she will be subject to the same RetirementPlus election (as described above) as members transferring from any other Massachusetts contributory retirement system. Note: TARP and RetirementPlus both refer to the same provisions of Chapter 114 of the Acts of 2000—TARP is the Boston retirement board’s name for this legislation, and RetirementPlus is the MTRS’s label.
- eligible for the Teachers’ Alternate Retirement Plan (TARP), and
- A Massachusetts contributory retirement system OTHER than the Boston retirement board, and transfers into the MTRS on or after July 1, 2001 with other MA service rendered prior to July 1, 2022, he or she will have a one-time RetirementPlus election period that is 180 days from the date that the MTRS first receives the member’s transfer of service and funds. If he or she then:
How a member’s contribution rate is determined
Based on the above, members’ contribution rates are as follows:
| Date employee established current “effective membership date” | RetirementPlus status | |
| Not participating in RetirementPlus* | Participating in RetirementPlus* | |
| April 2, 2012 and after | 9% plus 2% on earnings over $30,000/year; with 30 years of creditable service, contribution rate decreased to 6% plus 2% on earnings over $30,000/year | 11%; with 30 years of creditable service, contribution rate decreased to flat 8%, and no additional 2% |
| July 1, 2001 through April 1, 2012 | 9% plus 2% on earnings over $30,000/year | 11% |
| July 1, 1996 through June 30, 2001 | 9% plus 2% on earnings over $30,000/year | |
| January 1, 1984 through June 30, 1996 | 8% plus 2% on earnings over $30,000/year | |
| January 1, 1979 through December 31, 1983 | 7% plus 2% on earnings over $30,000/year | |
| January 1, 1975 through December 31, 1978 | 7% | |
| Before January 1, 1975 | 5% | |
The additional 2% deduction
Employees who establish membership on or after 1/1/1979 and who are not participating in RetirementPlus contribute an additional 2% on all earnings over $30,000. This deduction is also known as the 30-plus deduction.
30-plus deductions are calculated on a pay period basis by taking all regular compensation on a pay date, subtracting the 30-plus exemption amount based on the member’s pay schedule (see table below) and then multiplying the result by two percent. (Note: Members who coach at a school district other than the one in which they qualify as a teacher, are required to make 30-plus contributions on all coaching pay in their secondary district if they earn more than $30,000 annually with their primary employer.)
The 30-plus (2%) deduction calculation formula
Regular compensation for pay period – 2% exemption amount = Earnings subject to 2% deduction
Earnings subject to 2% deduction x 2% = Amount due for 2% deduction
For example, Mary earns a base salary of $52,000 per year, and this year is also receiving a longevity payment of $2,000; she is paid in 26 bi-weekly payments. On this particular pay date, she is receiving her normal bi-weekly pay as well as the full $2,000 longevity payment, making her total compensation amount $4,000. Using the exemption amount for a 26 bi-weekly pay schedule (listed in the following section) the amount due for Mary’s 2% deductions would be $56.92, as shown below.
$4,000.00 – $1,153.85 = $2,846.15
$2,846.15 x 2% = $56.92
30-plus (2%) deductions exemption amounts, per pay date, by common pay schedules
Weekly
52 pays (12 months or LS) $576.92
42 pays (10 months) $714.29
Bi-weekly
26 pays (12 months or LS) $1,153.85
22 pays (10 months) $1,363.64
21 pays (10 months) $1,428.57
Semi-monthly
24 pays (12 months or LS) $1,250.00
20 pays (10 months) $1,500.00
For additional information on the 30-plus deduction and how to calculate it, see PERAC’s Memo #43 of 1999.
Incorrect assessments: When deductions are taken at the wrong rate
Contribution rate corrections may occur at any time during a member’s career. On occasion, and possibly years after the employee began employment in your district, the MTRS may discover that a member’s contribution rate will need to be reviewed due to either previously unknown service that needs to be transferred-in, or service for which deductions were omitted in error by an employer. If a rate is detected as an error on your payroll exception report, please don’t make a change to that rate until you have received notification from the MTRS. If the member’s contribution rate is determined to be incorrect the MTRS will contact both the member and employer to notify them of the change. If we request a rate change and you have reason to believe that our determination is wrong (for example, you have documentation of the member’s previous service with another Massachusetts public retirement system, or a copy of a RetirementPlus form from their personnel record that was completed before their election deadline), please contact your Employer Services Representative before making any change to the member’s deduction rate.