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  1. #1
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    Default Anyone pay for social security?

    Hello from Illinois. Does anyone who works as a career firefighter and has a pension, also pay for social security?


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    I don't know of too many municipal FF paying into Social Security. If I recall correctly, police, fire fighters, and teachers are exempt from paying into the system. However, it comes with a catch: if you have a government pension and had worked a side job paying into the system, you get a reduced benefit (2/3?), regardless of the quarters you have earned.

    We use this as an reason to keep our pension benefits somewhat generous.
    Last edited by KenNFD1219; 03-04-2007 at 10:06 PM.
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    "The most mediocre man or woman can suddenly seem dynamic, forceful, and decisive if he or she is mean enough." from "Crazy Bosses"
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    Forum Member DeputyMarshal's Avatar
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    We do but we pay into our pension fund at a lower rate because of it. Our pension is reduced when we're eligible to collect SS.
    "Nemo Plus Voluptatis Quam Nos Habant"

    The Code is more what you'd call "guidelines" than actual rules.

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    Default retired!

    Quote Originally Posted by LieutenantDave View Post
    Hello from Illinois. Does anyone who works as a career firefighter and has a pension, also pay for social security?
    LT Dave;
    I worked years before I went into the Fire Service and have enough quarters to get my full SS benifit when the time comes. While on the FD I didn't pay SS taxes, but paid 7% into the pension for 21 years.

    Waiting on 2016 so I can retire again ! )
    Take Care & be SAFE
    Bert

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    Hmmm good thread. I am going to ask some questions next shift. I just started a side job due to having 2 kids on the way. Wonder how much the pension is reduced when your eligible for SS....
    Local #10

    Charles Stephen
    Eric Jeffrey
    Born 7/24/07
    My new twin boys that I love even more than being on the job!

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    Jeff:

    It is usually the other way around: SS is reduced because of your pension.

    I would like to here more about the system DeputyMarshal's FD has for reducing a pension. I never heard of that before.
    -------------------
    "The most mediocre man or woman can suddenly seem dynamic, forceful, and decisive if he or she is mean enough." from "Crazy Bosses"
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    Genius has its limits, but stupidity is boundless.

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    Here is an answer from the FAQ section of the Social Security web site. All United States Federal emloyees under the FERS retirement system pay into Social Security. There are some special provisions for firefighters and certain law enforcement personnel to draw a "supplement" from Social Security because their retirement age is well below the typical retirement age for most people. Take note that most of us will have to be sixty-six or older to draw the full benefit.



    Question
    If I receive a government pension, how will this affect my Social Security benefits?

    Answer
    If you worked in a job that was not covered under Social Security, e.g., some Federal, State, or local government employment, the pension you get based on that work may reduce your Social Security benefits. Your benefit can be reduced under one of two provisions.

    The first, called "government pension offset," applies only if you receive a government pension and are eligible for Social Security benefits as a spouse or widow(er). Under this provision, your Social Security benefit may be reduced by two-thirds of the amount of your government pension. There are several exceptions to this rule. For more information, see our GPO page or the GPO calculator.

    The other provision, called the "windfall elimination provision," affects how your Social Security retirement or disability benefits are figured if you also receive a pension from work not covered by Social Security. The formula used to figure your benefit amount is modified, giving you a lower Social Security benefit.

    Social Security benefits are based on a worker's average monthly earnings adjusted for inflation. When we figure your benefits, we separate your average earnings into three amounts and multiply the figures using three factors. For example, for a worker who turns 62 in 2007, the first $680 of average monthly earnings is multiplied by 90 percent; the next $3,420 is multiplied by 32 percent; the remainder by 15 percent. For more information, see our Online WEP Calculator.

    Under the windfall elimination provision, we figure your benefit under a modified formula in which the 90 percent factor is reduced to 40 percent. There are exceptions to this rule. For example, the 90 percent factor is not reduced if you have 30 or more years of "substantial" earnings in a job where you paid Social Security taxes. If you have 21 to 29 years of substantial earnings, the 90 percent factor is reduced to somewhere between 45 and 85 percent.

    For more information, you should read the Social Security fact sheets "Government Pension Offset" (Publication No. 05-10007) and "The Windfall Elimination Provision" (Publication No. 05-10045). You can file for retirement benefits online.

    Stay Safe
    IACOJ

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    I do not pay into social security through the fire department. I do, however, make a point to earn my 40 quarters through my side business. Here's why.....it's not for the retirement benefits, rather the medical insurance......medicare.
    If you don't pay in you will not be eligible.

    Many of our guys take a part time job after they retire (around age 50). This way when they turn 65 they qualify ofr medicare and get the medical benefits.
    I hope this helps.

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    Quote Originally Posted by KenNFD1219 View Post
    I would like to here more about the system DeputyMarshal's FD has for reducing a pension. I never heard of that before.
    It's the CT run MERS (municipal employee's retrirement system)*. There are a few FDs in the fund, some more PDs (ours just changed from a private pension) and a whole of AFSME type employee groups.

    There are two pension funding systems: employee's who do not pay into SS (like our PD) pay 5% into the fund and get a flat pension; employee's (like us) who pay SS pay only 2 1/5% into the fund but get a pension reduction when SS eligibility kicks in.

    Pension is vested in 5 or 10 years (depending on starting date) and pays 2% of average of best three years per year of service completed. Payable without penalty after either 25 years of service or age 55. (There's a pro-rating system for early pension draws.)

    For those who paid in under the SS plan, pension drops to 1.6% of average of best three years per year of service completed at age 62 (i.e. eligibility to start drawing SS).

    There are other factors that effect pension payout like what option you choose for continued payments to a surviving spouse, there's a decent floating COLA, etc. but that's it in a nutshell.

    *(Don't quote me on exact percentages -- I'm in the ballpark but I don't have the written info in front of me.)
    "Nemo Plus Voluptatis Quam Nos Habant"

    The Code is more what you'd call "guidelines" than actual rules.

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    The reason why I ask is that at my fire department, we are deducted for both a pension and for social security. There (to my knowledge) are not many fire departments that have this. Our pension contributions are not decreased because of this as well. When we asked our Village and some lawyers, it was told to us that since the inception, village employees paid for social security and now with the addition to a pension there is no way to stop the social security contributions. Has anyone ever heard of this. It is a lot of money taken out of our checks! Thanks....

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    I have heard of the MERS but did not know any details. Our pension plan is town owned and includes the FD, police, and other town workers (except teachers). We pay 4% of gross pay each week, no SS deductions. A member is eligible for retirement after 25 years, no minimum age. Pension is 75% of last three years average, including overtime, sick time payout (90 days max if hired before 1990, 30 days after) and unused vacation (5 weeks max). Retirees receive full medical benefits.

    After many years of mis-management, the town fully funded the pesnion system a couple of years ago through a municipal bond. Previous to that, the pension investments consisted of a bank passbook savings account . Distributions were a line item in the annual budget.

    We also have a non-service connected disability pension after 10 years of service which pays 50% of the last three years average.

    The chief and I are not in the union, but are part of the union pension plan.

    Members who paid into SS with side jobs collect the reduced benefit at 62.
    -------------------
    "The most mediocre man or woman can suddenly seem dynamic, forceful, and decisive if he or she is mean enough." from "Crazy Bosses"
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    Genius has its limits, but stupidity is boundless.

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    KenNFD

    That sounds like a pretty good plan there! We have to contribute 9.5% of our check to our Downstate Firefighter's pension fund. We can collect at 50 years old. At thirty years on you get max at 75%. At my fire department, we also have to contribute 6% to social security. So 15.5% is coming out the check for both! Also we do not get any medical when we retire. So it sounds like you have a good thing going over there..... Dave

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    Those employed sometime in the late 80s or early 90s pay the medicare portion of FICA only, which is just a few bucks a check. We have a pension system only for Police and Fire personnel employed by our local government. Current contribution rate is 11%.

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    In Illinois there are some departments that pay into both the Downstate Pension Fund and Social Security. In 2000 the fire district where I was employed was taken over by the city were we served on the request of the district trustees. The city employees paid into both. We were forced to do so as well. We tried getting some kind of help, but no one seemed to be able to give us an answer. The city didnt want to be on the hook for not deducting SS so they continued to do so. After 2 years,we finally got an opinion from the the SSA. We DID NOT have to pay into social security. We were refunded our contributions. The reason that some pay into social security is that when they originally hired people they didnt get into the penison funds. There was a slight window to get out. Since we never paid into social security before, we were not obligated to pay. Medicare deductions started in 1986. The good news is that if you pay into social security, the hit is not going to be a big as you think. I think the average is 300 bucks a month you lose in benefits. I wouldnt mind paying in if I would get my fair share back.
    IAFF-IACOJ PROUD

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    On another note. You iIllinois people should be very thankful for our pension system. We at the union level will work extremely hard to make sure our defined benefit pension plan remains so. There is a huge push across the country to go to defined contribution plans. There is going be a push to raise the percentage to 2.75 per year..Up from 2.5. This would increase your rate to 82.5 % after 30 years.
    IAFF-IACOJ PROUD

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    Being from ILLINOIS I'm all in for the extra towards our pension.

    LT. Dave[/QUOTE]In response to the Social Security deduction. You probable will not get a penalty at all if you've paid into it for the entire time. As I understand it, if you pay into SS for 30 consecutive years at a acceptable wage rate per SS you don't get penalized. I know a couple guys who have not been penalized becouse of this fact.

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    Quote Originally Posted by sprky131 View Post
    In response to the Social Security deduction. You probable will not get a penalty at all if you've paid into it for the entire time. As I understand it, if you pay into SS for 30 consecutive years at a acceptable wage rate per SS you don't get penalized. I know a couple guys who have not been penalized becouse of this fact.
    Sprky131, you need to check this out carefully well before you retire. As a previous poster stated "For more information, you should read the Social Security fact sheets "Government Pension Offset" (Publication No. 05-10007) and "The Windfall Elimination Provision" (Publication No. 05-10045)."

    Maine is one of the approximately 15-20 states (*see list below) whose pension plan falls into this definition. There are many cases of people participating in the State plan for their 30 years and also participating in Social Security by virtue of their second jobs. When they retire, they do not get full SS benefits. If they die before retirement, their survivor does not get full SS benefits.

    Here is an example from the National Education Association website. Example from NEA

    How does the Windfall Elimination Provision work?
    The WEP reduces the factor by which average earnings are multiplied to determine Social Security benefits. How much the factor is reduced depends on when the individual becomes eligible to retire and how many years of earnings he or she has accumulated.
    For example: Bob — a retired educator — worked for 17 years in Vermont, a state in which educators participate in the Social Security system. Bob then moved to Maine, a state in which educators are not covered by Social Security. Bob worked for 14 more years in Maine before retiring. According to the Social Security Administration, he earned monthly benefits of $540 per month for contributions paid into the Social Security system while he worked in Vermont. However, because of the WEP, his actual monthly benefits will be cut by $196 a month. Bob will receive only $344 per month from Social Security instead of the $540 he earned.

    Replace the words teacher and educator with the word firefighter and you can see the looming problem.

    States Where Public Employees Are Not Covered by Social Security

    * Alaska
    * California
    * Connecticut
    * Georgia (certain local governments)
    * Illinois
    * Louisiana
    * Kentucky
    * Maine
    * Massachusetts
    * Missouri
    * Nevada
    * Ohio
    * Rhode Island (certain local governments)
    * Texas (certain local governments)
    Last edited by Jim917; 03-07-2007 at 08:39 AM.
    Remember, it IS as bad as you think and they ARE out to get you!

  18. #18
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    We pay both Social Security and 7% into our state police/FF retirement system, with the city paying a certain percentage into the retirement as well.

    Seems there was an opportunity to opt out of paying the Social Security many years back, but that we missed the boat on it.

    I believe some others in our state do pay just the retirement and not into S.S.

    Would have been nice to not pay the S.S.
    FTM-PTB-RFB
    IACOJ

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