No. TRS is a defined benefit plan, with retirement benefits determined by a pre-established formula. The plan is administered as a qualified governmental retirement plan under the provisions of the U.S. Internal Revenue Code, Section 401(a). In addition, monthly member contributions are made on a pre-tax basis, meaning that at the time you receive your salary, you do not pay federal income tax on the portion of your salary used to make the contributions. Federal income tax on the contributions and interest is deferred until you receive a distribution from TRS, such as a refund or a retirement annuity. Amounts accumulated in your member account or your retirement benefits become taxable income in the years in which they are paid to you. As a governmental plan, TRS is not an “ERISA” (1) plan under the federal Employees Retirement Income Security Act of 1974.
(1) ERISA is a federal law that sets minimum standards for pension plans in private industry.
Answers are correct to the best of my ability but do not constitute legal or tax advice.
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