Leaving State Employment FAQ for Exempt and Partially Exempt Employees

This retirement and health benefit information is for exempt and partially-exempt State employees who may be leaving their positions during the State’s administration transition.


Deferred Compensation Plan (DCP)

  1. What happens to my accrued personal leave if I leave state service on or before December 31, 2018?

    If you do nothing else, the dollar value of your accrued personal leave will be paid out to you in your final paycheck. The amount paid to you will be subject to applicable taxes.

  2. How is the dollar value of my accrued personal leave derived?

    In accordance with 2 AAC 08.045, personal leave balances are converted monthly to a cash value, by multiplying the hours accrued by the annualized hourly rate of pay for the pay period.

  3. Is there a way to defer paying taxes on my accrued personal leave?

    Yes. If you participate in the State’s deferred compensation plan you can direct some or all of your leave (depending on what you have contributed so far in the tax year) to your deferred compensation account. You must submit a request to the Division of Retirement Benefits, Attention Natalya Khomyakova at . There is a deadline for submitting the request, however.

  4. What is the deadline for submitting a request to convert leave for deposit into my deferred compensation account?

    Under the terms of the Alaska Deferred Compensation Plan, requests must happen in the month prior to termination. Therefore, if you know the month in which you plan to terminate state employment, you must submit the conversion request anytime during the prior month. You should submit the conversion request prior to November 30, 2018 even if you are unsure if you are being retained. If you are retained, the request will not be processed as there will be no termination leave to convert. If you are not retained, we will be able to process the leave conversion to DCP.

  5. What if I am not currently enrolled in the Deferred Compensation plan?

    If you would like to enroll in the Deferred Compensation Plan you can either complete your enrollment online at: https://akdrb.empower-retirement.com or you can fill out the enrollment form and submit it to Empower Retirement at the fax number listed on the form. If you need a pin number for the website you can contact Empower Retirement at (800) 232-0859.

  6. When can I access my account?

    You can access your account after you have terminated employment or there is an unforeseeable emergency (as defined by the Alaska Deferred Compensation Plan).

    When you qualify for a distribution, your account value may be applied to the distribution option(s) you choose. These options include:

    • Do nothing and defer payment until you have obtained the age of Required Minimum Distribution
    • Lump-sum payment (full or partial)
    • Five-, 10- and 15-year period certain annuity
    • Single life annuity
    • Single life annuity with 10- or 15-year period certain
    • 50% or 100% joint/survivor annuity
    • Periodic payment
    • Direct rollover to an eligible retirement plan as set forth in the Alaska Deferred Compensation Plan.

    You may begin receiving funds immediately or defer receipt until to any date up to April 1 of the year after attaining age 70½. You will be allowed to take partial distributions, and there is no limit on the number of payments that can be taken; however, if you do not receive payment of your entire account, you must maintain a minimum $1,000 account balance.

  7. What if there is a change of administration?

    The Division of Retirement and Benefits will provide information and group seminars on leaving state employment in November. Generally speaking, employees that wish to convert leave to deferred compensation have adequate opportunity to do that in November so long as their last day of service is in December. The Governor is sworn into office at 12 noon on December 3.

    If, however, you believe you will terminate state service in December, you should consider converting personal leave in November. *Leave cash in requests for the month of November must be submitted to the Division by November 30th.

If you have further questions regarding Deferred Compensation, please contact Natalya Khomyakova at (907) 465-4462 or . This FAQ provides general information regarding the State of Alaska Deferred Compensation Plan. In the event of a conflict between this FAQ and the plan document, the plan document controls.

Supplemental Annuity Plan (SBS)

  1. Do I have to take my SBS account when I terminate?

    No. You do not have to make any decision about your SBS account immediately. Distributions are not required until the later of the first day of April of the calendar year following the calendar year in which you attain age 70 ½ or the date of actual retirement. You can leave your account balance in the plan and continue to control the investments. You can continue to participate in Managed Accounts or Investment Advice.

  2. Do I have to refund all of my account balance?

    No, you can take a partial refund.

  3. When can I make a withdrawal?

    You are first eligible to receive payment of your account 60 days after you have been terminated from employment. If you are re-hired before the 60-day period has passed, the withdrawal request will be canceled and a new 60-day period will begin at the next termination. However, if you terminate, and select an annuity payment, the annuity payment you are receiving will not be affected by subsequent re-employment. Partial lump sum withdrawals will cease upon re-employment. Actual payment mailing occurs after you have been terminated 60 days and the Plan administrator approves your distribution. The only exception to payment eligibility earlier than 60 days after termination is for a qualified hardship. There are very strict criteria that must be met for a hardship distribution.

  4. What payment options are available?

    Payment options include:

    • Do nothing and defer payment until you have obtained the age of Required Minimum Distribution (RMD)
    • Lump-sum payment (full or partial)
    • Five-, 10- and 15-year period certain annuity
    • Single life annuity
    • Single life annuity with 10- or 15-year period certain
    • 50% or 100% joint/survivor annuity
    • Periodic payment
    • Direct rollover to an eligible retirement plan as set forth in the Alaska Supplemental Annuity Plan Document.

    Lump-sum payments to participants, former spouse alternate payees, and spouse beneficiaries are eligible for direct transferor rollover to an eligible retirement plan as set forth in the Alaska Supplemental Annuity Plan. A rollover is a payment of your Plan benefits to another eligible plan. A payment from the plan that is eligible for “rollover” can be taken in two ways: You can have your payment paid in a direct rollover or paid to you and rolled over within 60 days of distribution.

  5. How will a distribution affect my taxes?

    You should consult with a qualified tax advisor to determine how the different distribution options will affect your taxes.

This FAQ provides general information regarding the State of Alaska Supplemental Annuity Plan. In the event of a conflict between this FAQ and the plan document, the plan document controls.

PERS DCR Tier IV

  1. Do I have to make a decision about my account balance before I terminate?

    No you do not. You can leave your account balance in the plan and continue to control the investment options and participate in the Managed Accounts or Investment Advice.

  2. When can I make a withdrawal?

    You are first eligible to receive payment of your account 60 days after you have terminated employment.

  3. What are the Plan payment options?

    After you have met the 60-day termination of employment requirement, you are eligible to select the payment option you choose. Payment options include:

    • Do nothing and defer payment until you have obtained the age of Required Minimum Distribution
    • Single life annuity
    • Period certain annuity (five, 10 and 15 years)
    • Single life with period certain annuity (10 or 15 years)
    • Joint and survivor (50% or 100%; may be chosen only by members)
    • Lump-sum payment (full or partial, two partial allowed per year)
    • Direct rollover to an eligible retirement plan as set forth in AS 14.25.360 and AS 39.35.760 as applicable.

This FAQ provides general information regarding the State of Alaska TRS/PERS Defined Contribution Retirement Plans. In the event of a conflict between this FAQ and the plan documents, the plan documents control.

PERS DB Tier I, II, III

  1. When can I retire?

    Your retirement benefit is effective the first day of the month following termination from employment and receipt of your application. You must be eligible for retirement.

    • All tiers must have five paid up years of service in order to be eligible for retirement.
    • Tier I are eligible for normal retirement at age 55 or age 50 for an early benefit.
    • Tier II and III are eligible for normal retirement at age 60 or early retirement at age 55.
    • All tiers are eligible for normal retirement with 30 years of paid up service.
    • Peace Officer and Firefighters are eligible for normal retirement with 20 years of paid up Peace Officer or Firefighter.
  2. When is my retiree medical insurance effective?

    If you are eligible for the system paid retiree medical it will be effective the first day of the month in which your retirement benefit is effective.

  3. What are my options regarding my contribution account balance if I terminate my position?

    You always have the option of leaving the money in your account. If you are a vested member intending to retire in the future or are a non-vested member and intend to become re-employed in a covered position in the future, it may be wise to do so.

    To obtain a refund of your contribution account balance you must complete a Refund Election Form.

    If you are non-vested (less than five paid years of service) or single, completing the form is sufficient. If you are a married and vested member, your spouse must consent to the refund on a form provided by the Division of Retirement and Benefits. This form must be notarized. If the rights to your refund are subject to a Qualified Domestic Relations Order (QDRO), you must also provide the notarized consent of each person entitled under the order.

    CAUTION: If you refund your contributions you will forfeit the service and your tier. If you return to TRS-covered employment on or after July 1, 2010, you will be enrolled in the PERS/TRS DCR Plan.

    If you refund your account, you become a former member and forfeit any rights you had as a member, including eligibility for medical benefits. If you refund your account, you must take a full refund. You cannot obtain a partial refund.

  4. When can I expect to receive the refund of my account balance?

    You should have completed form GEN008, Refund Election form [PDF 142K], which tells us your intentions concerning your refund. If you did not, contact your employer or contact us directly.

    There is a minimum waiting period of 60 days from your termination date or 30 days from the receipt of your application, whichever is later, before your refund will be processed. This is to make sure your employer has transmitted all of your contributions and your account can be refunded in full. There would be another week to ten days processing and mailing time once the waiting period has been met.

  5. How do I arrange for a direct transfer of my refund?

    You must arrange for another qualified plan, such as an Individual Retirement Arrangement Account (IRA), to accept a direct transfer of your taxable contribution account balance. Once you have arranged for an institution to accept this transfer, you would complete a Notification of Termination/Refund Application filling in the appropriate information. Be sure to include the plan name, address, plan contact person, and your account number.

  6. In an emergency, is there any way to obtain a refund of my account prior to the 60-day waiting period?

    The Division of Retirement and Benefits takes a critical view of what constitutes an emergency. For any emergency consideration, you must request a waiver in writing, and provide sufficient proof of your emergency. If you have other extenuating circumstances that you feel warrant consideration, you must provide a written detailed description to us along with your request for a waiver. If a waiver is granted in that case, a refund will be processed as soon as your employer has transmitted all of the contributions that were withheld from your pay.

This FAQ provides general information regarding the State of Alaska TRS/PERS Defined Benefit Retirement Plans. In the event of a conflict between this FAQ and the plan documents, the plan documents control.

PERS Voluntary Savings

  1. I participate in Voluntary Savings. Do I have to do something with it?

    If you are a member of the PERS Defined Benefit Plan, and have been participating in the PERS Voluntary Savings Plan, and you are retiring you, must take your voluntary savings also. If you are not retiring you may take your voluntary savings in a lump sum, an annuity, in installments or leave it in the account until you retire.

  2. What payment options are available?

    • Lump Sum Payment
    • Life Time Annuity
    • Five or Ten Year Period Certain Annuities.
    • Monthly Installments. The balance plus interest divided by the number of months you designate.
  3. What about my health insurance?

    Yes you can continue your health insurance coverage if you are not retiring. You must enroll within 60 days from the date coverage ends. Select Benefits members should contact the Division or Retirement and Benefits. Aetna will send out the COBRA forms.

For additional information about your retirement accounts please contact the Division of Retirement and benefits. There are Counselors available to speak with you about your benefits and assist you with any questions you may have.