1992 Federal Legislation
|Mandatory Social Security – The IRS regulations for part-time, temporary and seasonal employees were released on 6/26/91, and made effective Social Security coverage mandatory for public employees who are not members of a retirement system that provides a minimum level of retirement benefits. The regulations provide a safe harbor for the retirement system if the retirement system satisfies a specific test as provided in the regulations. STRS has determined that it does meet the safe harbor requirements for the system in general, however, the regulations provide more specific requirements for part-time, seasonal and temporary employees. Since STRS did not satisfy the provisions relating to “reasonable interest”, the TRB took action at its November `91 meeting to change the method of determining interest payable to member accounts to satisfy the vesting requirements and will be applied to all members’ accounts. Also, retired annuitants are exempt from these regulations under specified conditions, and overtime employment performed with the member’s employer is not subject to Social Security.||Effective 7/2/91 (refer to the Employer Information Circular dated 2/25/92, Volume 8, issue 1)|
|Rollover Provisions – The Unemployment Compensation Amendments Act of 1992 (to extend unemployment benefits) includes several significant changes in the treatment of distributions from qualified plans, including STRS. Under previous law, a member could receive a distribution and if it was “rolled over” within 60 days to an IRA, or qualified retirement plan, could avoid tax liability. Now, eligible distributions are subject to a mandatory 20% withholding of federal income tax unless they are directly rolled over into a new qualified plan or IRA. This is called a direct rollover or trustee-to-trustee transfer. This withholding applies even if the member directly receives a distribution and then rolls it over within the 60-day period.||Signed in July `92|
* STRS SPONSORED LEGISLATION
NOTE: Unless otherwise noted in italicized lettering, or with an asterisk (*) indicating STRS sponsored, legislation was sponsored by the author(s) or committee introducing the bill. Also, refer to the “Legend” for an explanation of abbreviations used.
Decade of Legislation, 1992 Federal Updated: May 11, 2001