Application
Use the Application for Service Purchase to request a basic cost estimate or an official cost quote. If you have not filed an Application for Retirement Benefits, a basic cost estimate will be generated. Completing the application does not obligate you to purchase service.
Cost
IPERS will calculate the cost of your service purchase and send you a basic cost estimate or, if your retirement application is on file, an official cost quote. A basic cost estimate is only a rough estimate of the actual cost of your service purchase. Use a basic cost estimate to learn approximately how much you will need to save to make a service purchase at the time you retire. The closer you are to retirement, the more accurate your estimate will be.
Official cost quotes include an expiration date. Service purchase payments must be postmarked by the expiration date on the cost quote.
You can purchase all or a portion of your qualified service credit in quarter-year increments. For example, if you are eligible to purchase two years of service (eight quarters), you can purchase any amount from one quarter to all eight quarters. Service purchases must be made in the following order:
- buy-up,
- buyback with cost credit,
- buy-back and
- buy-in.
If you apply for a cost quote of more than one of these four kinds of purchases and decide to make a purchase, you will have to buy all service of one kind before you can purchase any service of another kind. Purchasing service in this order generally allows you to purchase the least expensive service credit first.
Service purchases made in a calendar year cannot exceed a limit set by the federal government ($69,000 in 2024), unless you roll over money to IPERS from another retirement account or buy back IPERS service. There is no limit on the amount you can spend in a calendar year when you buy back IPERS service or when you roll over money from another retirement account to purchase service.
Although the amount you wish to purchase may be within the dollar limits described above, your service purchase cannot increase your IPERS benefits beyond the IRS limit on annual benefit payments and may be limited accordingly.
Remember, completing the Application for Service Purchase does not mean that you are obligated to purchase service. Allow IPERS at least four to six weeks to process a service purchase application.
Using rollover money to purchase service
If you have money in another retirement plan or retirement account, you may be able to use that money to purchase IPERS service credit without incurring any tax penalties. This is called a rollover. IPERS accepts rollover money from certain types of retirement plans including:
- 401(a)s and other qualified plans.
- IRAs and annuities.
- 403(b) tax-sheltered annuities.
- Governmental 457(b) plans.
If you have money in another retirement plan or retirement account, confirm with your retirement plan administrator the type of plan it is. Remember, the federal government does not limit how much you can purchase in a calendar year by rolling over money to IPERS.