What are the tax advantages of moving or rolling over the “Alameda Decision” funds into a deferred compensation account, like your Fidelity 457 plan?

Rolling over the funds preserves the pre-tax status of the funds and allows you to continue to invest the funds in your deferred compensation account as you determine appropriate.

How will this payment impact my taxes?

Taking a direct payment will be taxed, which may impact your income tax liability for 2022; SCERS does not offer tax or investment advice. Please consult with your tax or investment professional for tax or investment advice and questions.

Do I have to pay taxes on my refund?

Yes. If you are not rolling over your refund into another tax-qualified retirement account, SCERS is required to withhold 20 percent federal tax on payments distributed directly to you. SCERS will also withhold 2 percent California state tax unless you elect to not have state tax withheld on your distribution request form.  You will receive a 1099-R in January for your individual tax reporting purposes. For more information about your tax considerations, please review the Special Tax Notice that was included with your refund letter.

Please note: SCERS is not required to and will not withhold taxes on refund amounts less than $10. SCERS will not be issuing 1099s for refund amounts less than $10.

Why is my refund subject to a 10% early withdrawal penalty on top of regular taxes?

Under federal tax law, distributions from tax-qualified retirement accounts are generally subject to an additional 10% tax penalty if you receive the funds prior to age 59 ½, even if the distribution is due to a correction. These earnings have been held tax-free in the pension fund accruing interest, but would have otherwise been included in your normal paycheck, subject to income taxes and other federal withholdings. For more information about your tax considerations, please review the Special Tax Notice that was included with your refund letter.

Please note: SCERS does not withhold the additional 10%; the IRS will include it in your overall tax liability when you prepare your taxes.

Can I roll-over my refund to my 457 plan if I have already reached the annual limit?

Rolling over these funds into the County’s deferred compensation program will be handled as a rollover, instead of a contribution, and will be subject to standard rollover rules. Generally, there is not a limit on “rollovers.” Please consult with your tax or investment professional for tax or investment advice and questions.

Can I defer my payment or rollover until a later date?

SCERS will not be delaying/deferring payments to members. If a member does not select an option, a check will be issued.

How long will it take to receive the funds in my Fidelity account?

Once the rollover has been processed by SCERS, the funds are expected to be posted to your Fidelity account within 3-5 days thereafter.

How do I elect a rollover into my Fidelity account?

Complete Part B of the Payment Distribution Form

• Plan name is:  County of Sacramento 457(b) Deferred Compensation Plan
• Account number is: your SSN
• Sign and date the document, and return to SCERS for processing

How were the contribution refunds calculated?

SCERS removed the excluded Alameda pay elements from biweekly payroll data received from Sacramento County, applied the applicable member retirement contribution rate during the period for the excluded pay elements, and applied the semi-annual interest rate under SCERS Interest Crediting and Unallocated Earnings Policy. 

If I was previously contacted about receiving a refund but did not receive a letter, am I still going to get a refund?

Some member accounts required additional review and were not processed in this mailing. You can call us at 916-874-9119 to confirm if you were sent a letter in this round of mailings.

Can I send this form back via scan?

For distributions, SCERS requires the original signed copy and cannot accept scanned copies. You can inter-office the form, drop the form off in person, or mail the form in the postage paid envelope that was sent with your letter and request form.

Why is SCERS processing refunds less than $1?

SCERS is required to correct the record to reflect the correct pensionable earnings for each member regardless of the amount. As a tax-qualified retirement plan, SCERS must remove any disallowed contributions from the pension trust fund.

Why was the letter addressed to my maiden name or other name that I have since changed?

The name used for this mailing was provided by the County when the payroll data records were initially sent to SCERS. Please complete the distribution form using your current legal name.

If I believe my letter was lost or thrown away, how do I get a new one?

Please contact SCERS through email at sacretire@saccounty.net or by phone at 916-874-9119 to verify the address the original letter was mailed to. Staff can arrange to resend the letter to either your County work email or the mailing address on file. Another other option: You may come into the SCERS office, located at 980 19^th Street, Suite 1900, Sacramento, and complete your distribution option.  Please bring a valid photo ID.

If I believe I am entitled to a refund but did not receive a letter, when will I get my letter?

If you have not received any previous correspondence from SCERS regarding the Alameda Ruling (i.e., both mail and email communication have been sent to affected members) then you are not eligible for a refund. Please note that if you are a Miscellaneous tier 5 member, you are not affected by the Alameda Ruling. However, if you have received previous correspondence but did not receive a recent letter from SCERS dated Aug 31, 2022, Subject: Alameda Court Ruling – Contribution Refund, please contact SCERS via email at sacretire@saccounty.net or by phone at 916-874-9119 to confirm whether or not a letter was mailed.

If I believe there are pay elements missing or there was an error in my calculation, how do I contest this?

Any written objections, along with specific supporting information and substantiating documents, must be submitted to SCERS’ Chief Benefits Officer (CBO) within 30 days of your receipt of this notice. (While your objections are pending, your initial refund will be processed in accordance with the timeline and distribution method described above.) The CBO will make a determination regarding your objections. Any appeal of the CBO’s determination will be heard in accordance with Paragraphs C through F of the Appeal of SCERS’ Administrative Decisions Policy, available at https://www.scers.org/post/appeal-scers-administrative-decision-policy

Written objections to the CBO should be addressed as follows:

SCERS
Attn: Chief Benefits Officer
Re: Alameda
980 9th Street, Suite 1900
Sacramento, CA 95814