Direct Deposit of Monthly Benefits
LSPRS offers automatic direct deposit of monthly retirement benefits to your checking or savings account at any financial institution that is a member of the Automated Clearing House System. You must furnish a voided check (not a deposit slip) to LSPRS. This will provide the routing and account numbers necessary to set you up for direct deposit. LSPRS issues the transfer instructions to its bank in sufficient time for the direct deposit funds to be available on the last business day of each month.
Monthly Benefit Checks
Benefit checks for retirees not using direct deposit are mailed on the last business day of each month. If you do not receive your check within seven (7) business days, please notify LSPRS. We will stop payment on the lost check and mail you another check. Please note that effective January 1, 2004, direct deposit is mandatory.
- The retirement benefit is payable to you for your lifetime.
- Federal income tax is payable on the amount of retirement benefits received, excluding the amount of unsheltered contributions as described below.
- You will recover a portion of the unsheltered (non-taxable) contributions each year according to provisions of the Internal Revenue Code. Unsheltered contributions are the amount of employee contributions you paid into LSPRS during employment which you have already paid taxes on. This amount includes all employee contributions made for the purposes of additional service credit or repayment of refunds. LSPRS uses a formula provided by the IRS (safe-harbor method) to determine your non-taxable portion at the time of retirement. LSPRS reports that amount on the form 1099-R that is sent to you each year.
- Retirement benefits are not subject to Louisiana individual income tax. However, you must file an annual Louisiana State Income Tax return to claim the exemption.
- You may deduct the following from your LSPRS benefit payment:
State Group Benefits Insurance
La Capitol Federal Credit Union
Benefit Fund Dues
Honor Fund Deductions
Federal Withholding Tax
You must authorize the deduction in writing and can change it any time by submitting a written request to LSPRS. When preparing for retirement, please discuss deductions thoroughly to insure there will be no lapse in your coverage.
Reemployment of Retirees
If you return to employment after retirement as a uniformed officer of the Office of State Police, you will not be entitled to renew your membership in or become a member of the system. If your earnings in such employment are more than 50 percent of your final average compensation, payment of your retirement benefits will be suspended for each month of such employment. Upon termination of such reemployment, the suspended retirement benefit will again be paid.
Employment in any other agency, including DPS if the employment is in any other capacity other than as a state police officer, has no restriction on earnings.
Sick and Annual Leave
Upon retirement, you may choose one of two options available with regard to your sick and annual leave balances:
1.) You may convert the balances to retirement credit after you reach eligibility. You will be paid for 300 hours of annual leave by DPS when you retire. The remaining balance of annual leave plus the sick leave balance certified by DPS upon retirement will be converted to credit. There is no limit to the amount of unused sick and annual leave you can convert to retirement credit. You cannot use sick and annual leave to qualify for retirement or any other benefits payable by LSPRS.
Conversion formula: Balance Divided by 2,080 = Service Credit
Annual leave balance at retirement = 1299
Sick leave balance at retirement = 2044
Less payment for 300 hours annual = -300
Total convertible hours = 3043
3,043 divided by 2,080 = 1.46 Years
2.) In lieu of conversion of leave to retirement credit, you may, at the time of retirement, choose to be paid in a lump sum for the leave at its actuarial value as determined by the retirement system actuary.