FAQ – Special Pay Plan (SPP)

Here you will find information on your Special Pay Plan (SPP) provided to you at retirement from your school district. If you are not sure if your employer is providing you with an SPP or HRA, please go to Your Plan to find out.

Considering Retirement

After retirement, you will have access to your Special Pay Plan funds. A Special Pay Plan is a 403(b) retirement plan funded by your employer using special forms of compensation such as your unused sick leave and unused vacation pay. Payments may also be based on your years of service, severance and other retirement incentives.

  • Your contributions are 100% vested upon retirement and made on a pre-tax basis
  • You permanently save 7.65% on FICA taxes (Social Security and Medicare)
  • Funds are invested in a Fixed Interest account with a competitive rate of return
  • Funds are not subject to market risk

Funds are invested in a fixed annuity with a guaranteed rate of return. Investments are provided by American United Life Insurance Company®, a OneAmerica® Company (AUL). For more information on your investments, please visit www.oneamerica.com.

See “Getting Serious about Retirement” below.

Getting Serious about Retirement

After retirement, you will have access to your Special Pay Plan funds. A Special Pay Plan is a 403(b) retirement plan funded by your employer using special forms of compensation such as your unused sick leave and unused vacation pay. Payments may also be based on your years of service, severance and other retirement incentives.

For information on eligibility, please refer to Your Plan Highlights.

Yes. There are maximum allowable limits on contributions to your 403(b). Your employer is aware of the annual contribution limit and makes deposits accordingly. To view the current maximum allowable limits, click here.

Only your employer can make deposits into your Special Pay Plan. You cannot contribute.

You will receive paper statements on an annual basis. However, you may access your account activity anytime by logging in to your account on MidAmerica’s secure website. Your temporary login is your Social Security number and your temporary password in the last four digits of your Social Security number. You will then be asked to change your username and password.

Yes. The Beneficiary Form can be obtained by locating your employer in the Your Plan section of the website.

Yes. You can roll over an eligible retirement account into your Special Pay Plan.

See “Congratulations on your decision to retire!” below.

Congratulations on your decision to retire! FAQs

You can request a distribution by completing a Distribution Election Form, which can be found by locating your employer under the “Your Plan” section of the website.

You are eligible to take a distribution from your account upon retirement or separation of service.

There is an IRS 10% penalty for distributions taken prior to 59 1/2, for plans such as this. However, if you are at least age 55 upon separation and remain separated, the penalty does not apply. If you return to work prior to age 59 ½ for the same employer for more than 20% of your preretirement schedule, to avoid the penalty, you should suspend distributions until you reach age 59 ½.

You are required to begin receiving Required Minimum Distributions (RMDs) by April 1 of the year following (a) attainment of age 70½ or (b) retirement, which is later. If you do not begin receiving your RMD, the IRS applies an excise penalty tax equal to 50% of your total RMD not distributed during the taxable year. Beginning in the year you turn 70½, MidAmerica will send you an annual statement each fall noting the amount of your RMD. If you have more than one 403(b) plan, you have the option to take your total aggregated RMD amount from only one plan.

What are my distribution options?

You can choose to take your distribution:

  • Monthly
  • Quarterly
  • Annually
  • One time
  • Lump-sum

If you choose an installment option, the installment must be a minimum of $500. If the funds are less than $500, then you will receive a lump-sum payment in the amount of the available funds.

To review the loan policy on your plan, please refer to Your Plan Highlights.

No, there are no fees associated with your Special Pay Plan.

Post-Retirement

After retirement, you will have access to your Special Pay Plan funds. A Special Pay Plan is a 403(b) retirement plan funded by your employer using special forms of compensation such as your unused sick leave and unused vacation pay. Payments may also be based on your years of service, severance and other retirement incentives.

Funds are invested in a fixed annuity with a guaranteed rate of return. Investments are provided by American United Life Insurance Company®, a OneAmerica® Company (AUL). For more information on your investments, please visit www.oneamerica.com.

For information on eligibility, please refer to Your Plan Highlights.

Yes. There are maximum allowable limits on contributions to your 403(b). Your employer is aware of the annual contribution limit and makes deposits accordingly. To view the current maximum allowable limits, click here.

Only your employer can make deposits into your Special Pay Plan. You cannot contribute.

You will receive paper statements on an annual basis. However, you may access your account activity anytime by logging in to your account on MidAmerica’s secure website. Your temporary login is your Social Security number and your temporary password in the last four digits of your Social Security number. You will then be asked to change your username and password.

Yes. The Beneficiary Form can be obtained by locating your employer in the Your Plan section of the website.

Yes. You can roll over an eligible retirement account into your Special Pay Plan.

You are eligible to take a distribution from your account upon retirement or separation of service.

There is an IRS 10% penalty for distributions taken prior to 59 1/2, for plans such as this. However, if you are at least age 55 upon separation and remain separated, the penalty does not apply. If you return to work prior to age 59 ½ for the same employer for more than 20% of your preretirement schedule, to avoid the penalty, you should suspend distributions until you reach age 59 ½.

You are required to begin receiving Required Minimum Distributions (RMDs) by April 1 of the year following (a) attainment of age 70½ or (b) retirement, which is later. If you do not begin receiving your RMD, the IRS applies an excise penalty tax equal to 50% of your total RMD not distributed during the taxable year. Beginning in the year you turn 70½, MidAmerica will send you an annual statement each fall noting the amount of your RMD. If you have more than one 403(b) plan, you have the option to take your total aggregated RMD amount from only one plan.

What are my distribution options?

You can choose to take your distribution:

  • Monthly
  • Quarterly
  • Annually
  • One time
  • lump-sum

If you choose an installment option, the installment must be a minimum of $500. If the funds are less than $500, then you will receive a lump-sum payment in the amount of the available funds.

To review the loan policy on your plan, please refer to Your Plan Highlights.

You can request a distribution by completing a Distribution Election Form, which can be found by locating your employer under the “Your Plan” section of the website.

No, there are no fees associated with your Special Pay Plan.