June 10, 2020/Line-of-Duty Death Benefits
New York State Law now provides an accidental (or "line-of-duty") death benefit to statutory beneficiaries of working and certain recently retired members who died due to COVID-19.
Eligible members must have reported to work outside the home on or after March 1, 2020, contracted COVID-19 within 45 days, and died due to COVID-19 before January 1, 2021. This accidental death benefit is also available for members who meet the above criteria and retired between March 1 and July 1, 2020.
In general, an accidental death benefit is an annual annuity equal to 50% of the wages earned during the member's last year of service, reduced by any ordinary death benefit already paid under TRS' Qualified Pension Plan. (Other options and restrictions may affect the benefit amount.)
The benefit is payable to statutory beneficiaries, in the following order:
- A spouse who has not renounced survivorship rights in a separation agreement, until death or remarriage; or
- Children, in equal shares until they reach age 25; or
- Dependent parents; or
- Any other person who qualified as a dependent on the member’s final federal income tax return, until that person reaches age 21.
TRS is currently developing applications that statutory beneficiaries may use to claim this benefit and will announce when they are available.
May 27, 2020/Line-of-Duty Death Benefits
TRS is monitoring pending New York State legislation that would authorize line-of-duty death benefits for certain public employees (including TRS members) whose deaths were related to COVID-19. TRS does not have additional information but will post an update if the bill becomes law.
May 15, 2020/CARES Act
CARES Act Loans
Qualified members may now apply online for a QPP or TDA loan under the CARES Act Provisions. The available loan amounts are higher through these CARES Act loans (generally, up to the lesser of $100,000 or 75% of available account balances) than through the standard QPP or TDA loans. Separate CARES Act loan applications are available for members who log in to our website.
CARES Act FAQs
Answers to many questions about the CARES Act provisions are available on our FAQs page
. Topics include TDA withdrawals under the CARES Act, loans under the CARES Act, deferral of loan payments, and the suspension of TDA Required Minimum Distributions for 2020.
May 5, 2020/CARES Act
Loan Payment Deferral
Members who certify that they meet criteria established by the CARES Act may defer payments on any QPP or TDA loan for 12 months. Interest will continue to accrue during the period, and the term of the loan will increase by 12 months. Qualified members must apply for the payment deferral on our E-Forms page after logging in with their username and password. Additional information about deferral of loan payments is available here
Members who are paid on the Department of Education payroll have limited time to make this election before their summer paychecks are cut.
If you want to have your loan payment deductions stopped before your summer paychecks, please file as soon as possible this week. Payroll changes (such as stopping loan payment deductions) that are requested in early May can generally be implemented before the summer paychecks are cut, but changes requested later cannot be implemented until the first payroll in September or later.
May 1, 2020/CARES Act
- Qualified members may now apply online for a TDA withdrawal under the provisions of the CARES Act. After logging in to the secure section of the website, members can use the Withdraw Funds option on their TDA page. Please note that the TDA Withdrawal Application (code TD32)—both the PDF and e-form versions—cannot be used for CARES Act distributions.
Under the CARES Act, qualified members may receive TDA distributions of up to $100,000 with no early withdrawal penalty. These distributions are not rollover-eligible and are taxable as ordinary income, reportable over a period of up to three years. These distributions may also be paid back to the member's TDA account or to another eligible plan within three years. In total, a member may not receive more than $100,000 in CARES Act-related distributions from all City-sponsored plans. For more information, please contact your tax advisor.
As part of the withdrawal application, qualified members must certify that they a) have been diagnosed with COVID-19, b) have a spouse or dependent who was diagnosed with COVID-19, or c) were financially harmed by COVID-19 due to quarantine, furlough, layoff, reduction in work hours, inability to work due to lack of child care, or closure/reduction of hours of their own business.
- Qualified members will be able to apply for loans online under the provisions of the CARES Act in the second half of May. We will publish more information in a future update.
April 17, 2020/CARES Act
The CARES Act provides easier access to retirement funds for those who are in financial need due to the pandemic and meet qualifying criteria (specified below). TRS will introduce the following CARES Act provisions over the next several weeks:
- Qualified members will be able to apply online for a special CARES Act TDA distribution of up to $100,000. No early withdrawal penalty will apply. Recipients will have the option of spreading the distribution over three years on their tax returns, and of repaying the distribution to their TDA accounts.
- Qualified members will be able to apply for a CARES Act loan under both TRS plans, the Qualified Pension Plan and the TDA Program. The available loan amounts will be higher through these CARES Act loans (generally, up to the lesser of $100,000 or 75% of available account balances) than through the standard QPP or TDA loans. Separate CARES Act loan applications will be available on our website.
- Qualified members will be able to defer making loan payments for a 12-month period on both new loans and existing loans. (Interest will accrue during this period.) This option will be built in to the new CARES Act loan applications, and special forms will be available to members who want to pause their current loan payment schedule for 12 months.
We will announce the availability date for each feature in a future update. All of these provisions are temporary, and they will be available to members who certify that they meet the criteria established by the CARES Act—specifically that they a) have been diagnosed with COVID-19, b) have a spouse or dependent who was diagnosed with COVID-19, or c) were financially harmed by COVID-19 due to quarantine, furlough, layoff, reduction in work hours, inability to work due to lack of child care, or closure/reduction of hours of their own business.
The CARES Act has also suspended Required Minimum Distributions for 2020 for defined-contribution plans like TRS' TDA Program. RMDs would normally be paid to certain retired members with TDA accounts and TDA Beneficiary (TDAB) members, but no distribution will be required in 2020. By early May, TRS will contact affected members by letter to explain the suspension and to communicate the amount that they would have been required to receive as an RMD; that amount is not eligible for direct rollover in 2020.
April 9, 2020/CARES Act
- The CARES Act contains various provisions for qualified individuals who may need access to retirement funds due to the current pandemic. Among these is a special "coronavirus-related distribution" that will be available to TRS members from their TDA account. In addition, loan limits will be temporarily increased for members who meet certain criteria. TRS is working on making the additional distribution and loan options available to members later in April, and we will post more specific information here next week.