How to Read My Statement of Benefits - Alternate Payee

1. Name & Address:  Make sure you receive important information about your WRS account by keeping your contact information up to date. See the Change My Contact Information page for steps to change information.
2. IRS Codes:  The WRS falls under Internal Revenue Service Codes 401(a) and 403(b). The WRS is a defined benefit pension plan; it is neither a 401(k) nor a 457(b). See the WRS Retirement Benefit page for more information.

• This Statement of Benefits contains information about your alternate payee account under the WRS. As the former spouse or domestic partner of a WRS participant, you were awarded a percentage of your former spouse or domestic partner’s WRS account through a Qualified Domestic Relations Order (QDRO). 
• Your alternate payee account includes your share of their WRS account (contributions, years of service, and interest) as of the decree date of the QDRO. The decree date is the effective date used to divide the WRS account. Your account is credited with annual interest each December 31.
• Carefully review the information about Required Minimum Distributions (the deadline to apply for your benefit) at the bottom of this page.

3. Section 1 – Earnings and Service:  This section does not apply to Alternate Payee accounts.
4. Section 2 – Years of Creditable Service:  This section shows your former spouse's or domestic partner’s creditable service that was transferred to your alternate payee account. This includes military service, if applicable. Service is broken down into three types: "Before 2000," "After 1999," and "After Act 10." Your former spouse or domestic partner may have service in one, two, or all three types, depending on when and how long they worked under the WRS. See the WRS Retirement Benefit page for more information.
   • If the QDRO decree date was after 1999, and your former spouse/domestic partner was employed in a WRS-covered position before 2000 and after 1999, a higher formula multiplier is applied to the “Before-2000” years of service when calculating your formula retirement benefit.
   • Only employees in the elected/executive category have “After Act 10” service. A lower formula multiplier is applied to this service. See the Calculating your Retirement Benefits (ET-4107) brochure for more information, including the various formula multipliers.

5. Section 3 – Employee-Required Contributions:  This section shows your share of your former spouse or domestic partner’s cumulative employee-required contributions in your account. It does not include their employer contributions (see Section 9 for your total account balance). Your interest rate is shown in this section. Annual interest is applied each December 31 to that year’s beginning balance(s).
6. Non-taxable portion of employee contributions (Investment in Contract):  Since July 2011, most employee contributions are made on a before-tax basis and are not taxed until you receive a WRS benefit. The non-taxable portion of your account is called your “Investment in Contract.” It is your share of the amount of after-tax employee contributions paid by your former spouse or domestic partner. The non-taxable portion of your WRS benefit will be based on this amount.

7. Section 4 – Additional Contributions:  This section shows the current balance of your share of any voluntary additional contributions your former spouse or domestic partner, or their employer, made to their WRS account before the decree date. The decree date is the effective date used to divide the WRS account.
8. Additional contributions always receive the effective rate of interest. Annual interest is applied each December 31 to that year’s beginning balance(s).
9. If your former spouse or domestic partner was approved for a Long-Term Disability Insurance (LTDI) benefit before the decree date, the LTDI supplemental contributions are included as Core Employer Additional Contributions. Your Core balance includes your share of the LTDI supplemental contributions as of the decree date. See the Additional Contributions page for more information.
10. Investment in Contract:  Employee additional contributions are made on an after-tax basis. After-tax employee additional contributions are the Investment in Contract amount. The non-taxable portion of your WRS benefit will be based on this amount. Note: Before 2009, some employees made before-tax additional contributions (tax-deferred). Those and all employer additional contributions are fully taxed when the WRS benefit is paid. For information about taxes on additional contributions, see the Tax Liability on WRS Benefits (ET-4125) brochure.
11. Section 5 – Primary Beneficiary Designation(s):  This section shows who receives any death benefit payable when you die. Your statement only shows your primary beneficiary designation(s) added after 1988. Secondary and tertiary beneficiaries are not listed, but are on file with ETF. If you do not have one on file or you turned one in before 1988, you will see an automated message. Changes in your personal situation like marriage, divorce, or termination of a domestic partnership do not change your beneficiary designation. You must file a new designation form to change your beneficiary. See the Designate a Beneficiary page for more information.
    • If you never filed a beneficiary designation or if your beneficiary(ies) are all deceased, your death benefit will be paid according to the standard sequence specified by Wis. Stat. § 40.02 (8)(a).

12. Section 6 – Separation Benefit:  This section shows the amount available if you are eligible to receive a separation benefit. A separation benefit is a one-time (lump-sum) payment consisting of employee contributions, additional contributions (if applicable), and interest. It does not include employer contributions. If you choose this option, you will lose the employer contributions (if vested) and your account will be closed.
    
    You may take a separation benefit under one of two circumstances:

    • Your former spouse has not yet reached minimum retirement age (age 55, or age 50 with some protective category service that was not purchased forfeited service), or your former domestic partner has not yet reached normal retirement age (age 65 for general employees and teachers). See When Can I Retire for information about other employment categories.
    • Your account is not vested.

    An alternate payee can apply for a benefit even if the participant is still employed under the WRS. Once the participant reaches minimum retirement age (if you are a former spouse), and is vested, you are eligible for a retirement benefit based on both the employee and employer contributions.

13. Section 7 – Death Benefit: If you die before your WRS benefit begin date, the death benefit amount shown, plus any interest, is the amount payable to your beneficiary(ies).

14. Section 8 – Formula Benefit Data:  This section shows the data ETF uses to calculate your formula retirement benefit. See the WRS Retirement Benefit Calculations page for more information.
15. Your former spouse's or domestic partner's three highest years of WRS earnings. The years do not need to be three years in a row, nor the three most recent years of earnings.
16. Your former spouse's or domestic partner’s final average monthly earnings (FAE). The FAE is calculated by adding the total earnings in the three highest years, dividing that amount by the total service credited for those three years, then dividing by 12.
17. A Variable excess or deficiency amount is shown if your former spouse or domestic partner participated in the Variable Fund before the effective date of your alternate payee account. This amount shows the value of your account compared to the value it would have been if your former spouse/domestic partner had never participated in the Variable Fund. A Variable excess will increase your formula benefit, while a Variable deficiency will decrease it. See the Variable Fund page for more information.
18. Section 9 – Money Purchase Balance:  Your monthly money purchase retirement benefit is calculated by multiplying your total money purchase balance (including interest) by the money purchase factor for your age on your benefit begin date. Your benefit will be based on this balance, unless the formula calculation (using data in Section 8) is higher. You are eligible to apply when your former spouse is age 55 (age 50 if your account includes any protective service that is not purchased). If your account is from a former domestic partner, you are eligible to apply when they are normal retirement age. See the WRS Retirement Benefit Calculations page for more information.

19. Section 10 – Retirement Benefit Projections:  No projections are shown for alternate payee accounts. Contact ETF to request a retirement benefit estimate 6 to 12 months before you plan to apply for a retirement benefit.

• You must be vested to be eligible for a retirement benefit. A retirement benefit is available only if your former spouse is age 55 (age 50 if they had some protective service on the decree date), or if your former domestic partner is normal retirement age. 

• Some participants must meet one of two vesting laws based on when they first began WRS employment. As an alternate payee, your vesting status generally depends on whether your former spouse/domestic partner is vested.

  • Participants who first began WRS employment after 1989 and terminated employment before April 24, 1998, must have some WRS-creditable service in five calendar years.
  • Participants who first began WRS employment on or after July 1, 2011, must have five years of WRS-creditable service. 
  • If neither vesting law applies, participants were vested when they first began WRS employment. If the participant was not vested on the decree date, but later becomes vested by earning the required service (before taking a benefit), you also become vested.

  Contact ETF to request a retirement benefit estimate six to twelve months before you plan to apply for a retirement benefit. Please note, your statement does not include any account receivable amount due if you have an outstanding balance pending. Any monies owed on your account will be deducted from your WRS annuity, if not paid in full before you apply for benefits.

Additional Information for Vested Alternate Payees
If you are vested, you may want to consider applying for your retirement benefit as soon as you are eligible, regardless of your employment status or income. Delaying your retirement benefit may increase your monthly payment. Calculate how long it will take to recover the monthly payments and any annual increases that you will give up by waiting to begin your benefit.

Additionally, if you die before you begin receiving a retirement benefit, the death benefit will be less than your total account balance because you will forfeit the employer contributions.

Additional Information about Required Minimum Distributions

Once you stop working for a WRS employer, federal law requires you to begin receiving your benefit payment(s) by a certain date, depending on your age. This is called a required minimum distribution (RMD) . Visit the RMD page for detailed information about current RMD requirements, and the potential impact a RMD may have on your WRS benefits and tax liability. You may also want to consult with your tax advisor.

It is important for you to contact ETF before a forced distribution is required. Once a forced distribution begins, your ability to choose a different payment option, if available, will be very limited. Your WRS account will be closed and you will not be able to return your payment(s).