Judicial Retirement System
Member Handbook

As of December 2002


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FOREWORD

The New Jersey Judicial Retirement System Member Handbook has been revised to incorporate changes to the retirement system made since the last version was published in 1994. The Member Handbook provides a summary description of the benefits of the plan and outlines the rules and regulations governing the plan. The Member Handbook should provide you with all the information you need about your Judicial Retirement System benefits. It is as accurate as we could make it, however, if there is a conflict with statutes governing the plan or regulations implementing the statutes, the statutes and regulations will take precedence. If you are unsure of, or have questions about, any aspect of your JRS benefits, you should ask your Judges Benefits Representative in the Administrative Office of the Courts (AOC) or a counselor at the Division of Pensions and Benefits about them.

Since this is your Member Handbook, we would appreciate any comments or suggestions for improvement that you might have. Please send them to the address listed below or download the evaluation form. (PDFfile - 51K)

Division of Pensions and Benefits
ATTN: Publications Unit
P.O. Box 295
Trenton, NJ 08625-0295

THE RETIREMENT SYSTEM

The Judicial Retirement System (JRS) was established on June 1, 1973 after the repeal of the laws that had provided benefits to certain members of the judiciary and their beneficiaries since 1948. For administrative purposes, the State House Commission acts as the Board of Trustees.

The purpose of this handbook is to provide you with information about the retirement system to assist you in making decisions concerning your future and your family’s future. If, after reading this handbook, you have questions concerning your retirement system benefits, see Contacting the Administrative Office of the Courts and The Division of Pensions and Benefits for information on contacting the Human Resources Office of the Administrative Office of the Courts or the Division of Pensions and Benefits.

Be sure to also check in on the Division of Pensions and Benefits home page at www.state.nj.us/treasury/pensions to learn of any new developments affecting the JRS.

MEMBERSHIP

Eligibility

If you are a member of the State Judiciary, you are required to join the JRS as a condition of employment.  The JRS covers the Chief Justice and Associate Justices of the State Supreme Court, as well as all judges of the Superior Court and Tax Court of the State of New Jersey.

ENROLLMENT

Enrollment/Certification of Payroll Deductions

Both you and the Administrative Office of the Courts (AOC) must complete the enrollment application for you to enroll in the retirement system. The AOC will send the completed application to the Division of Pensions and Benefits for processing. When processing is complete, you will receive a Certification of Payroll Deductions showing the date deductions will begin, your rate of contribution, and any back deductions due.

You may wish to keep the Certification of Payroll Deductions on file with your other important papers so that you have a record of your enrollment in the retirement system.

Proof of Age

All members of the JRS must provide a copy of proof of their age before retiring. You should attach your proof of age to your enrollment application; however, do not delay sending the enrollment application if proof of age is not readily available. Acceptable evidence of your age includes a copy of:

Contribution Rate

You and the State share in the cost of benefits provided by the JRS.

If you enrolled in the JRS prior to January 1, 1996, your contributions are equal to 3 percent of the difference between your current salary and the salary for that judicial position on January 18, 1982.

Judges enrolled on or after January 1, 1996 contribute 3 percent of their total base salary to the pension system.

Since January 1, 1987, your mandatory pension contributions have been federally tax deferred under the 414(h) provisions of the Internal Revenue Code. This reduces your gross wages subject to federal income tax. Purchases of service credit made are voluntary pension contributions and are not tax deferred unless rolled over from another tax-deferred plan.

BENEFITS FROM OTHER SYSTEMS

Membership in the Judicial Retirement System requires that you belong to no other retirement system during the duration of your enrollment in the JRS. You will have to cease to be a member in any other retirement system prior to JRS enrollment, and you cannot join any other retirement system while a member of the JRS.

If you are a member of another New Jersey State-administered retirement system at the time you become a judge, you can:

Information regarding these options will be explained in writing at the time of your enrollment in the JRS to assist you in making the decision that best meets your needs.

SERVICE CREDIT

It is important that you receive the appropriate amount of service credit for the amount of time you work. Your service and contributions are reported biweekly. You receive judicial service credit equal to one biweekly pay period for each pay period a full pension contribution is made.

You receive non-judicial service credit for any service (other than prior judicial service) which you are able to transfer from another State-administered retirement system into the JRS at the time of enrollment in the JRS.

You may also be eligible to purchase credit for prior service. See Purchasing Service Credit below.

CREDIT FOR MILITARY SERVICE AFTER ENROLLMENT

The federal Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) provides that a member who leaves employment to serve on active military duty is entitled to certain pension rights upon return to employment with the same employer. The time in military service is to count for vesting and retirement qualification purposes as though the employee had not left. However, the member will have to make the pension contributions normally required to have the military service time included in the calculation of the retirement benefit.

PURCHASING SERVICE CREDIT TO ENHANCE YOUR RETIREMENT BENEFIT

Since your retirement allowance is based in part on the amount of service credit posted to your account at the time of retirement, it may be beneficial for you to purchase additional service credit if you are eligible to do so. Only active members of the retirement system are permitted to purchase service credit. An active member is one who has made contributions to the retirement system within two years of his or her purchase request. In no case can you receive more than one year of service credit for any calendar or fiscal year.

If you purchase former judicial service it is credited as "judicial service" in your JRS account. All other types of purchased service is credited as "non-judicial service" in your JRS account.

TYPES OF SERVICE ELIGIBLE FOR PURCHASE

Partial Purchases

You may purchase all or part of any eligible service. If you make a partial purchase, you may purchase any remaining unpurchased service at a later date. The cost of any later purchase will be based upon your age and salary at the time you request the second purchase.

COST AND PROCEDURES FOR PURCHASING
SERVICE CREDIT

You may obtain a quotation of the cost for purchasing additional service credit by writing to the Judicial Retirement System, Division of Pensions and Benefits, PO Box 295, Trenton, NJ 08625-0295. In your correspondence be sure to include the dates of the service you are requesting to purchase, the former employer’s name and address, the name of the retirement system, and the job title you held.

The cost of a purchase is based on three factors:

The purchase cost increases as your age and/or salary increase.

To estimate the cost of a purchase, multiply your current annual salary times the purchase factor corresponding to your nearest age. The result is the lump-sum cost of one year of service. Multiply this cost by the appropriate number of years being purchased.

No quotations of cost will be calculated until verification of employment is received by the Division of Pensions and Benefits.

Purchase Rate Chart

Nearest Age Purchase Factor Nearest Age Purchase Factor
40 0.0298 56 0.0939
41 0.0324 57 0.0969
42 0.0352 58 0.0994
43 0.0383 59 0.1017
44 0.0416 60 0.1035
45 0.0453 61 0.1043
46 0.0492 62 0.1051
47 0.0535  63 0.1059
48 0.0582 64 0.1067
49 0.0633 65 0.1075
50 0.0688 66 0.0183
51 0.0738  67 0.1091
52 0.0786 68 0.1100
53 0.0829  69 0.1108
54 0.0870 70 0.1116
55 0.0906    

After the Division of Pensions and Benefits processes your application to purchase service credit, you will receive a quotation of the cost of the purchase. You must respond to the quotation letter within the specified time period. When you agree to purchase a certain amount of service credit, the Division of Pensions and Benefits assumes that you will complete the purchase and credits your account with the entire amount of service even if you are paying the cost through payroll deductions. Any estimates of retirement allowance you receive, including your Personal Benefits Statement, are based on the full amount of service credit you agreed to purchase.

You may pay the cost of purchasing service credit:

If you retire before completing the purchase, you will receive prorated credit for the amount of service actually purchased or you can pay the balance at the time of retirement and receive full credit.

A member who authorizes a purchase of service credit through payroll deductions may cancel those deductions at any time. No refunds will be made of any lump-sum payments, partial payments, or installment payments. The member will receive a prorated credit for the service purchased to the date installment payments cease. Any subsequent requests to purchase the remaining service credit shall be based on the laws and rules in effect on the date that the subsequent request is received. If you have an outstanding arrears obligation for the purchase of additional service credit, interest may be assessed if there was a lapse in payments for a period of two years or more.

LOANS

If you are an active contributing member of the JRS, you may be eligible to borrow from your account twice per calendar year. You may borrow up to a total of one-half of your posted pension contributions or up to a maximum loan balance of $50,000, whichever is less. Loans are governed by the following conditions.

You may obtain a Loan Application by contacting your Judicial Benefits Representative, the JRS, or over the Internet.

You may apply for a loan regardless of your age. If you retire before repaying the outstanding balance of your loan, your loan payments can be carried into retirement. That is, your biweekly loan amount will be converted into a monthly deduction from your retirement allowance. You may also repay your outstanding loan balance in one lump sum prior to retirement.

If you die before repaying your loan (either before or after retirement), the outstanding balance will be deducted from the proceeds of any benefits being paid to your beneficiaries. If you terminate your judicial service and withdraw your contributions before repaying your loan, all your contributions less the loan balance and outstanding interest will be returned to you.

Internal Revenue Service (IRS) Requirements

Internal Revenue Code section 72(p) requires that loan balances cannot exceed $50,000 and must be repaid within five years. The regulations also require members to make timely payments toward outstanding loan balances.

While it is the responsibility of the State’s Centralized Payroll Office to withhold loan deductions from your salary, if you are out of work without pay, your employer has no salary from which to take deductions. Failure to repay the loan as scheduled may result in the unpaid loan balance being declared in default. If a loan is in default, the loan balance will be declared a taxable  or “deemed distribution” and will be reported to the IRS. For the tax year in which a default occurs, the Division of Pensions and Benefits will send you a Form 1099-R for tax filing purposes in January of the following year. You will be required to include the portion of the loan representing before-tax contribution as income on your federal return. In addition, if you are under age 59½, you will be required to pay an additional 10 percent tax for taking an early pension distribution.

If you default on your loan, it will be your responsibility to make an estimated tax payment to the IRS to cover your tax liability on the deemed distribution as no withholding will be deducted from your account by the Division.

If you resume your loan repayments after the default, the payments received will be posted to your account as already-taxed contributions that will increase the non-taxable portion of your pension at retirement. A deemed distribution cannot be cancelled by resuming your loan payments or repaying the loan in full prior to the end of the tax year in which the default occurs. Please note that unlike a normal pension distribution, a loan treated as a distribution cannot be rolled over to an IRA or another qualified retirement plan. Members who take a loan and subsequently fail to remit loan payments may also be subject to additional IRS regulations.

SUPPLEMENTING YOUR PENSION

In addition to your regular pension contributions, there are other opportunities to supplement your retirement income and possibly set aside money on a tax-deferred basis.

New Jersey State Employees Deferred Compensation Plan

Since you are on the State payroll, you may be eligible for the New Jersey State Employees Deferred Compensation Plan (IRS section 457). Contributions to the plan are not subject to federal income tax until you take a distribution from the plan, either at retirement or termination before retirement. The main benefits of the plan are to help you save on federal income tax now and to supplement your retirement income through investments. Informational booklets on investment options and other pertinent information are available by calling (609) 292-3605 or writing to: Division of Pensions and Benefits, New Jersey State Employees Deferred Compensation Plan, PO Box 295, Trenton, New Jersey 08625-0295.

Supplemental Annuity Collective Trust (SACT)

All active JRS members are eligible to participate in the Supplemental Annuity Collective Trust (SACT). SACT is a voluntary investment program that provides retirement income separate from, and in addition to, your basic pension plan. Your contributions are invested conservatively in the stock market. JRS members are eligible for the SACT-Regular Plan [IRC section 403(b)]. SACT information and enrollment packets are available by calling (609) 633-2031 or by writing to: Division of Pensions and Benefits, Supplemental Annuity Collective Trust, PO Box 295, Trenton, New Jersey 08625-0295.

Group Variable Universal Life Insurance Investment Options

See the information on this after-tax investment program available to JRS members.

RETIREMENT

Types of Retirement

There are several types of retirement to meet your individual needs. Keep in mind that retirement is mandatory at age 70.

JRS retirements are calculated using a combination of your age at retirement, your total years of judicial service credit and/or non-judicial service credit, and your Final Salary.

Definitions

‘Judicial service’ means all your years as a judge under the Judicial Retirement System.

‘In the aggregate of public service’ means your total years of both judicial and non-judicial service credit in the JRS. This would include service transferred into JRS from another New Jersey public pension system.

‘Final Salary’ means the salary on which your JRS pension contributions are based as of the date of your retirement.

Service Retirement

Service Retirement is the type of retirement for which most members qualify.

Service Retirement with only Judicial Service

If you retire at:

your annual benefit is calculated at 75% x Final Salary.

Service Retirement with Judicial Service and Non-Judicial Service

If you retire at:

your annual benefit is calculated at 50% x Final Salary.

If you retire at age 60 – 64 with 15 years or more in the aggregate of public service of which five or more consecutive years were judicial service, your annual benefit is calculated as follows:

2% x Final Salary x number of years of service up to 25 years;
plus
1% x Final Salary x number of years of service over 25 years.

If you retire at age 60 or older and do not meet the minimum amounts of service credit listed above, your annual benefit is calculated as follows:

2% x Final Salary x number of years of judicial service up to 25 years;
plus
1% x Final Salary x number of years of service over 25 years.
Early Retirement

If you wish, you may retire before age 60 and receive a reduced benefit, provided you have:

In this case, your benefit will be calculated as follows:

2% x Final Salary x number of years of service up to 25 years;
plus
1% x Final Salary x number of years of service over 25 years;
and
then actuarially reduced for the number of months remaining until you are age 60, to cover the cost of paying your benefit over a longer period of time.

Deferred Retirement

If you leave the JRS before you are eligible for a Service or Early Retirement and you are under the age of 60 — and you were not removed for cause on charges of misconduct or delinquency — you may still have a right to a retirement benefit. This is known as Deferred Retirement.

You are eligible for a Deferred Retirement if you leave after completing:

Your Deferred Retirement benefit is calculated in the same way as an Early Retirement, taking into account your salary and service when you leave. However, your Deferred Retirement benefit is not reduced since it is not payable until you reach age 60.

At any time before your Deferred Retirement becomes effective, you may change your mind and apply for withdrawal of your contributions instead. Once you cancel your Deferred Retirement and withdraw your contributions, all the rights and privileges of membership end.

Please note the following important information about your life insurance, health care coverage, and outstanding loan and purchase payments if you are considering a Deferred Retirement.

Life Insurance – Your noncontributory group life insurance coverage is not in effect between the time you terminate judicial service and your Deferred Retirement becomes effective. If you die between the time you terminate your judicial service and your retirement becomes effective, the last named beneficiary will receive only the return of your pension contributions with interest. There is no other death benefit under these circumstances.

Your contributory group life insurance ends when you terminate your employment.  However, if you have the Group Variable Universal Life Insurance, you have the option to keep it in effect by remitting premiums directly to Prudential.  If you do so, that policy, and the value of any supplemental investments you made, would be payable upon your death.

Health Benefits – Those electing Deferred Retirement cannot normally transfer their active health care coverage to the retired group of the State Health Benefits Program; however, those electing Deferred Retirement may be eligible for continuation of State Health Benefits coverage under the federal legislation called COBRA* for up to 18 months if they were covered by the State Health Benefits Program just prior to terminating their judicial service. If the actual retirement commences while the 18 months of COBRA coverage is in effect, the retiree may then transfer from the COBRA coverage and continue the State Health Benefits Program coverage into retirement. If the 18 months of COBRA coverage ends before the retirement commences, the member will not be entitled to maintain health coverage in retirement through the State Health Benefits Program. Participants should contact the AOC to see if they qualify for COBRA continuation.

* Consolidated Omnibus Budget Reconciliation Act (COBRA) for 1985.

Loans – If you have an outstanding loan, Internal Revenue Service regulations require that after two years without receipt of a scheduled payment your loan will be considered in default. The unpaid loan balance will be declared a taxable or “deemed distribution” which will be reported by the Division of Pensions and Benefits to the IRS. The Division will send you a Form 1099-R for tax filing purposes in January of the following year. You will be required to include the portion of the loan representing before-tax contributions as income on your federal tax return. In addition, if you are under age 59½, you will be required to pay an additional 10 percent tax for taking an early pension distribution.

Purchase Arrears – If you have an outstanding arrears obligation for the purchase of additional service credit, interest may be assessed if there is a lapse in payments of two years or more.

For purchases authorized after September 8, 1998, the purchase will be canceled after two years with no payments and the time prorated. Members returning from an approved leave of absence, however, may have the original purchase resumed.

Disability Retirement

For your added security, the retirement system provides an income if you become disabled before qualifying for a Service, Early, or Deferred Retirement.

You are considered disabled if:

If certified, your Disability Retirement benefit will be calculated at 75% x Final Salary.

The effective date of a Disability Retirement is determined by the Administrative Office of the Courts. A Disability Retirement application must be on file with the Judicial Retirement System at least 30 days prior to any effective date of a Disability Retirement. However, the retirement date cannot be earlier than the date of approval by the Governor.  

Approval for Workers’ Compensation or Social Security Disability benefits has no bearing on your application for JRS Disability Retirement.

OPTIONAL SETTLEMENTS AT RETIREMENT

Upon your death as a retired member of the JRS, your eligible surviving spouse receives a statutory survivor benefit equal to 25 percent of your Final Salary. Dependent children are also eligible to receive a statutory survivor benefit. These statutory benefits, along with group life insurance benefits, are described in detail.

In addition to the statutory survivor benefits for an eligible spouse and/or dependent children, you may also elect one of eight voluntary pension options that provide a pension benefit to a named beneficiary of your choice.

Selecting an option will reduce your monthly retirement allowance. The amount of this reduction depends on which option you select. Regardless of the payment option you select, your retirement benefits are paid during your lifetime (see exceptions).

NOTE: You may estimate payment amounts for the pension options using the option factor tables in Fact Sheet #54, Calculating Your Own Retirement Allowance.

Please be sure you understand the different payment options available to you because once your retirement becomes “due and payable” you cannot change your option selection. “Due and payable” is defined as 30 days after your retirement date.

Should a member apply for retirement and die prior to the retirement becoming effective, the retirement benefit beneficiary may choose between the active death benefits (survivor’s benefit, active life insurance, return of pension contributions) or the retired death benefits (survivor’s benefit, retired life insurance, retired optional settlement).

Note: whether or not you take an optional settlement at retirement, the statutory survivor benefit for an eligible surviving spouse and/or dependent children remains in effect.

Maximum Option — also called a single-life annuity, is the highest amount payable and provides a retirement benefit to you for the remainder of your life. If you are not concerned with providing either a lump-sum benefit or providing a monthly income to another person after your death, the Maximum Option may be the most appropriate payment choice for you. The benefit payments continue for your lifetime only. Upon your death, benefits end and your survivors do not receive a pension allowance other than those provided under the statutory survivor benefits.

If there is no surviving spouse or child to receive the statutory survivor benefit and you die before receiving, through your retirement allowance, the amount that you contributed to the retirement system while working (including interest on those contributions), the balance of your contributions will be paid to your named beneficiary or your estate.

Options other than the Maximum

Under Options A, B, C, or D you receive a smaller monthly benefit than that provided under the Maximum Option so that, upon your death, a beneficiary you name will receive a lifetime monthly pension. The percentage of reduction is based on the life expectancies of both you and your beneficiary at the time of your retirement and the option selected. Therefore, the younger your beneficiary, the greater the percentage of reduction in your benefit. Your beneficiary under these options must be an individual. You may not designate a charity, institution, your estate, etc. as a beneficiary. Under Options A, B, C, and D, if your beneficiary dies before you, your retirement allowance will increase to the Maximum Option.

You may name more than one beneficiary for this option and you can change your beneficiary at any time. Your beneficiary may be a person, a charity, an institution, or your estate.

For example: if your monthly retirement allowance is $6,000 and your retirement reserve is $547,200, your beneficiary would be entitled to the following payment depending on when you died (16 or 120 months after retirement as shown below).

Retirement Reserve $ 547,200
Retirement Benefits Paid   (death at 16 months)    $96,000
Beneficiary Benefit $451,200
Retirement Reserve $547,200
Retirement Benefits Paid (death at 120 months)   $720,000
Beneficiary Benefit  $0

Since the retirement reserve is based on your retirement allowance and your life expectancy, your own reserve may be much different than this example.

Under Options 2, 3, or 4 you receive a smaller monthly benefit than that provided under the Maximum Option so that, upon your death, your beneficiary will receive a lifetime monthly pension. The percentage of reduction is based on the life expectancies of both you and your beneficiary at the time of your retirement and the option selected. Therefore, the younger your beneficiary, the greater the percentage of reduction in your benefit. Your beneficiary under these options must be an individual. You may not designate a charity, institution, your estate, etc. as a beneficiary. Under Options 2, 3, and 4, if your beneficiary dies before you, your retirement allowance remains at the reduced level.

Age Limits on Non-spouse Beneficiaries

For all options, you can name your spouse as your beneficiary regardless of your spouse's age. For Options 1, 3, C, or D, you can name someone other than your spouse as beneficiary regardless of age.

For Options 2 and A (100% to beneficiary), if you are naming a beneficiary who is not your spouse, Internal Revenue Service regulations restrict the age of your beneficiary to no more than 10 years younger than you.

For Option B (75% to beneficiary) you can name a non-spouse who is no more than 19 years younger than you.

If you name a non-spouse beneficiary under Option 4, if the dollar amount of your beneficiary's pension is more than half of your allowance, restrictions on your beneficiary's age apply.

Applying for Retirement

You should inquire about retirement at least six months before your retirement date. This will give you enough time to review your benefits. (See the retirement checklist.)

You may request an estimate of your JRS retirement benefits by writing to the Judicial Retirement System, Division of Pensions and Benefits, PO Box 295, Trenton, NJ 08625-0295, or calling (609) 292-5175. The estimate will provide you with the retirement allowance available and your lump-sum death benefits.

It is your responsibility to file an Application for Retirement Allowance with the Division of Pensions and Benefits. All retirements are effective on the first of a month (except mandatory retirements which are effective on the judge’s 70th birthday, and disability retirements which are determined by the AOC). You are permitted to submit your Application for Retirement Allowance as late as the last business day prior to your retirement date, but four months advance filing is recommended. Under no circumstances can a retirement become effective prior to the date the application is received by the Division of Pensions and Benefits. Processing times vary and cannot begin until the Division has received all the necessary information and forms from both you and the AOC.

If you have not furnished proof of your age to the Division, you must do so now (see acceptable proofs of age). Proof of age for your beneficiary is also required. If your beneficiary’s birth evidence is under a maiden name, identifying documentation is necessary (marriage certificate). Please attach photocopies of your proof-of-age documentation to your retirement application.

State Health Benefits Program Coverage at Retirement

JRS members, who are eligible for State-paid health insurance coverage until their retirement date, will be offered State Health Benefits Program (SHBP) coverage for themselves and their eligible dependents when they retire.

If you had 25 or more years of service credited in the JRS before July 1, 1997, the State of New Jersey agreed to pay the full health benefit cost. In addition, you will be reimbursed for the cost of any Medicare Part B premiums paid by you and/or your covered spouse.

If you attain 25 years of service after July 1, 1997 or retire on a disability, you may share in the health insurance costs according to the rules of the State Health Benefits Commission for non-aligned employees in effect at the time you reached your 25 years of credited service or retired on a disability. The amount of your Medicare Part B reimbursement will also be stipulated in Commission rules. If you started to work for the State after July 1, 1997, you will not be reimbursed for Part B Medicare premiums when you retire.

JRS members who do not retire on a disability, or do not have 25 or more years of service credit at the time of retirement, must pay the full cost for their health benefit coverage. Premiums are usually deducted from the monthly pension checks. If your monthly check is not sufficient to cover the premium, you will be billed monthly.

Unsatisfied Balances

Loans – If you retire with an outstanding loan balance, you may:

Purchase Arrears – When you apply for a purchase of service credit, the Division assumes that the obligation will be paid before your retirement and your account is credited with the full amount of service you are purchasing. If this obligation has not been paid when you retire, your Quotation of Retirement Benefits will state the balance of your purchase arrears as of your retirement date. At that time, you must pay the balance of your arrears. If you  do not pay off the balance, the service credit which has not been paid for will be subtracted from your total years and months of service. This may affect the amount of your retirement allowance, and/or your eligibility for retirement and/or your eligibility for State-paid health benefits in retirement.

If you have an outstanding arrears obligation for the purchase of additional service credit, interest may be assessed if there was a lapse in payments of two years or more.


Shortages – A shortage in your pension account occurs when the State’s Centralized Payroll Office does not deduct the proper pension contribution from your salary. You will be notified by the Division of Pensions and Benefits of the amount of any shortage. You are responsible for payment of any shortages at retirement.

No retirement will be paid until purchase arrears and shortage obligations have been satisfied.

Retirement Checks

Your first retirement check is not payable until 30 days following your retirement date. This is when your retirement becomes ‘due and payable.’ If approval of your retirement is delayed, your first check will be retroactive to the date of your retirement. Regular retirement checks are dated on the first of the month to cover the allowance for the previous month. For example, your check for the month of September will be dated October 1st.

Change of Address

Although retirement checks can be forwarded to a new address, it is important that you inform the Division of Pensions and Benefits of any change in your address. When informing the Division of Pensions and Benefits of an address change, be sure to include your new address and your retirement number or Social Security number. You can change your address with the Division of Pensions and Benefits by calling (609) 292-MOVE (6683) or over the Internet at www.state.nj.us/treasury/pensions/changead.htm

Direct Deposit

We strongly recommend direct deposit of retirement checks. Shortly after your retirement date the Division of Pensions and Benefits will send you an Authorization of Direct Deposit form. If you wish to have your retirement checks directly deposited, send the completed form to the Division of Pensions and Benefits. Please allow approximately 90 days for the direct deposit to begin. Direct deposit will prevent your retirement checks from being lost, stolen, or delayed in the mail.

Cost-of-Living Adjustment

The Pension Adjustment Program provides cost-of-living adjustments (COLA) to you and your eligible survivors who receive a monthly retirement allowance from the State-administered retirement systems. The first COLA is granted in the 25th month after your retirement. Subsequent COLAs are computed annually and the adjustment is reflected in the February 1st check (payment for the month of January).

Your rate of increase is equal to 60 percent of the percentage of change between the average Consumer Price Index (CPI) for the calendar year in which you retired and the average CPI for the 12-month period ending August 31st immediately preceding the year when the adjustment is payable. We use the CPI index for Urban Wage Earners and Clerical Workers (CPI-W), U.S. City Average.

EXAMPLE: To calculate the COLA due February 1, 2003. A member retired in 1983 with a monthly retirement allowance of $3,400.00. The average CPI for the twelve months ending December 31, 1983 was 99.8. The average CPI for the twelve months ending August 31, 2002 was 174.8.

To calculate the change in the CPI:
subtract 99.8 from 174.8. (174.8 - 99.8 = 75.0)

To calculate the percentage change in the CPI between the retirement year, 1983, and the 12 months ending August 31, 2002:
divide 75.0 by 99.8 which equals 75.150%.

The cost-of-living adjustment rate for February 1, 2003 equals 60% of 75.150% or 45.090%. (60% X 75.150% = 45.090%)

Therefore the cost-of-living adjustment for this member is 45.090% of $3,400.00 or $1,533.06 per month (45.090% X $3,400.00 = $1,533.06).

The total monthly benefit equals $4,933.06. ($3,400.00 + $1,533.06).

Federal Income Tax after Retirement

The degree to which your pension is taxed depends on whether or not the payments you receive have been previously taxed. Employee contributions made prior to 1987 were made with after-tax dollars, that is, they were federally taxed prior to being made. Contributions for the purchase of service are also made with after-tax dollars unless rolled over from another tax-deferred plan. All State contributions and system earnings are before-tax dollars and are thus taxable.

If you began contributing to the pension plan in 1987 or after, and you have not made a purchase of service credit, your entire pension is subject to federal income tax because your contributions have never been taxed.

If you contributed to the pension plan before 1987, and/or you have made a purchase of service credit using after-tax dollars, your pension is immediately taxable based on the “expected return rule.” Part of your retirement allowance comes from your own pension contributions. Since your contributions before 1987 and most purchases of service credit are already taxed, the Internal Revenue Service (IRS) allows you to recover those contributions tax-free. This recovery is spread out over your expected lifetime or the combined lifetime of you and your beneficiary according to IRS life expectancy tables. This means that a small portion of each monthly retirement check is tax-free. The remainder of the monthly benefit is subject to federal income tax.

JRS Disability Retirement benefits are subject to federal tax to the same extent as other pensions.

Any federal tax questions should be referred to the IRS at 1-800-TAX-1040.

NJ State Income Tax after Retirement

If you live in New Jersey, you will be subject to New Jersey State income tax when you have recovered in pension checks the amount of pension contributions you made to the retirement system while working. However, if you will not recover your total contributions within three years of retirement, contact the NJ Division of Taxation at 1-800-323-4400, or see the NJ Gross Income Tax Return Form 1040 instructions to determine how your pension is taxed.

If you are receiving a JRS Disability Retirement allowance, your pension is exempt from New Jersey income tax if you are under age 65. When you reach age 65, your disability pension is treated as a regular pension and is considered taxable for New Jersey income tax.

Withholding Federal and NJ State Income Tax

The Division of Pensions and Benefits will provide for the withholding of federal and New Jersey State income tax from your retirement check. The Division is obligated to withhold federal income tax unless you file a Form W-4P instructing us not to do so. New Jersey income tax withholding is voluntary, and none will be withheld unless you instruct us to do so. Please keep in mind that if you live outside New Jersey your retirement benefits are not subject to New Jersey State income tax, but may be subject to state or local taxes in the jurisdiction in which you reside. There is no provision for withholding any local or out-of-state taxes.

New retirees will automatically receive federal and New Jersey State W-4P forms for withholding income tax.  After that, you may obtain a federal or New Jersey State W-4P form by calling or writing the Division of Pensions and Benefits. W-4P forms are also available over the Internet at: www.state.nj.us/treasury/pensions

At the end of January of each year, the Division of Pensions and Benefits issues a Form 1099-R reflecting the taxable retirement allowance paid during the preceding tax year for use in preparing your federal and State income tax.

The Division of Pensions and Benefits cannot provide tax advice. Any questions about your federal income tax should be directed to the Internal Revenue Service at 1-800-TAX-1040. For questions about New Jersey income tax, call the New Jersey Division of Taxation at 1-800-323-4400.

Social Security

Your pension is not reduced by any Social Security benefits you may receive nor should your Social Security benefits be reduced because of your JRS pension.

YOUR RETIREMENT CHECKLIST

When planning for a successful retirement, it is important to give yourself enough time to review your benefits and options. The time frames in this checklist are a guide. Processing times vary and cannot begin until the Division of Pensions and Benefits receives all the necessary information and forms from both you and the Administrative Office of the Courts.

6 – 8 Months Before Retirement

Request an estimate of your JRS retirement benefit by writing to the Judicial Retirement System, Division of Pensions and Benefits, PO Box 295, Trenton, NJ 08625-0295, or calling (609) 292-5175. The estimate will provide you with the retirement allowances available, and your lump-sum death benefits payable under the noncontributory group life insurance.


3 – 4 Months Before Retirement

Approximately 2 Months Before Retirement

You will receive a Quotation of Retirement Benefits letter which shows your monthly retirement allowance with:

You will receive a letter offering you enrollment in the New Jersey State Health Benefits Program (SHBP) if you are currently covered by the SHBP.

Approximately 1 Month Before Retirement Shortly After Your Retirement Date

REDUCTION OR SUSPENSION OF YOUR
RETIREMENT BENEFITS

Normally, you will receive retirement benefits for as long as you live. Your benefits, however, could be reduced or suspended if:

Your benefits can be reduced or suspended if you are convicted of a crime involving your employment. The State House Commission is empowered to order the forfeiture of all or part of the pension or retirement benefit of a member for misconduct during public service which renders the service, in whole or in part, dishonorable.

The Division of Law is required to inform the Division of Pensions and Benefits whenever a public official or employee is prosecuted or convicted. State and local public employers are also required to notify the Division of Pensions and Benefits whenever a public official or employee is removed from public office or employment for cause. The State House Commission considers each case on its own merits.

EMPLOYMENT AFTER RETIREMENT

Working for private industry or the federal government after retirement will not affect your retirement benefits. Most public employees will not resume public employment in New Jersey after retirement. For those who do, there are several areas of concern:

Disability Retirees Restored to Active Service

Before returning to active service, disability retirees must first prove to the satisfaction of the State House Commission that they are no longer disabled. When you return to active service, you enroll again in the retirement fund. Deductions for pension are resumed and you are treated as an active member in all respects. Upon subsequent retirement, you will receive a benefit based on total service.

ACTIVE AND RETIRED STATUTORY DEATH BENEFIT

Upon your death, as an active or retired JRS member, the following benefits are payable.

Retired members may also elect to provide an optional pension benefit to a beneficiary who they name.

The statutory benefit to a spouse and/or children is described in the next section. See the description of description of group life insurance and optional retirement benefits available to retired members.

Payment of Statutory Death Benefits

The terms used in the explanation of the statutory death benefits are explained here.

Surviving Spouse – means the person to whom you have been married for at least four years on the date of your death and who has not remarried (if you die as a result of an accident during the performance of your regular or assigned duties, and your death is not a result of willful negligence, the four year requirement is waived).

Child – means your unmarried child:

Parent(s) – means your parent(s) who was(were) receiving at least one-half support from you in the 12 months immediately preceding your death.

Final Salary – for the purpose of the Statutory Death Benefit, “Final Salary” means the current salary for the judicial position in which you served at the time of death or retirement.

Active Members

Upon your death as an active member, your eligible surviving spouse receives a statutory pension benefit equal to 25 percent of your Final Salary,

plus

If there is no surviving spouse, or your spouse dies or remarries, the following benefit is payable to your eligible children:

If there is no surviving spouse or dependent child(ren), a pension is paid to your eligible parent(s) as follows:

If there is no surviving spouse, child(ren), or parent(s), the member’s contributions are paid to your named beneficiary. In the event a specific beneficiary is not named, the funds will be paid to your estate.

Retired Members

Upon your death as a retired member, your eligible surviving spouse receives a pension benefit equal to 25 percent of your Final Salary,

plus

If there is no surviving spouse, or your spouse dies or remarries, the following benefit is payable to your eligible children:

Continuation of State Health Benefits Program Coverage

For active or retired JRS members, a surviving spouse may continue health coverage through the State Health Benefits Program (SHBP) as long as he or she is included under your SHBP coverage at the time of death. It will be the survivor’s responsibility to pay for the full cost of the coverage. The coverage can also include any dependent children who are covered at the time of death.

GROUP LIFE INSURANCE

JRS members are eligible for both Contributory and Noncontributory Group Life Insurance. Group life insurance is provided through policies issued by the insurance carrier — the Prudential Insurance Company of America.

CONTRIBUTORY GROUP LIFE INSURANCE

Upon enrollment all JRS members are eligible for one of two types of Contributory Group Life Insurance.

Both the Group Term Life insurance and the GVUL insurance offer coverage at levels of 1½, 2, 3, 4, or 5 times your judicial salary. Upon enrollment in one of these contributory group life insurance plans, you can also enroll your spouse and/or dependent children in a $5,000 group term insurance policy.*

*Spouses who are also judges enrolled in the JRS may not be covered as both a judge and a spouse.

Contributory Group Life Insurance premiums are paid through regular payroll deductions. Rates are adjusted each year on of the first day of the pay period that includes May 1 — the anniversary date of the plan.

Your Contributory Group Life Insurance amount is based on your judicial salary at enrollment and is adjusted, for any pay increases thereafter, on of the first day of the pay period that includes May 1.

Added Benefits of the GVUL

In addition to the life insurance benefits provided by this coverage, the GVUL insurance plan offers additional benefits including investment options that allow you to direct funds to any of 16 variable annuity plans (similar to mutual funds), and loans against your GVUL insurance. See the plan prospectus, which is available from Prudential, for full details.

Enrollment in Contributory Group Life Insurance

The JRS requires that newly enrolled members must be covered by one of the two contributory group life insurance plans for at least the first 12 months of membership. Either plan is optional for JRS members after completing the first twelve months of service or for members enrolled prior to May 1, 2001.

JRS members who are not covered by contributory group life insurance may elect to enroll at any time, but must provide evidence of good health.

Evidence of Good Health 

Newly enrolled JRS members do not need to provide evidence of good health for coverage at 1½ times salary. Evidence of good health is required from any JRS member for enrollment at higher coverage levels or for those enrolling or increasing coverage at a later date.

Contributory Group Life Insurance Coverage at Retirement
or Termination of Employment

Group Term Life insurance coverage ends when you retire or terminate covered employment. You can, however, continue your contributory group life insurance coverage after you leave employment by purchasing a converted life insurance policy from Prudential, without a medical examination, at your own expense. See “Conversion of Group Life Insurance” for more information.

Group Variable Universal Life (GVUL) insurance is “portable coverage.” This means that coverage can be continued after retirement or if you leave covered service as a judge. You will be billed monthly by Prudential for the full premium plus a $3 monthly service fee.

For More Information about the Contributory Group Life Insurance Plans

Both the Group Term Life insurance and the GVUL are administered by Prudential. If you have any questions about the program or would like to receive a plan prospectus, contact the Prudential Insurance Company of America, Group Life Services, PO Box 948, Horsham, PA 19044, or call 1-800-524-0542.

NONCONTRIBUTORY GROUP LIFE INSURANCE

NOTE: The following information applies only to the noncontributory group life insurance provided by the JRS; it does not pertain to the separate contributory group life insurance option described above.

The State pays the cost of your noncontributory group life insurance. Upon enrollment, you receive an individual certificate from the Division of Pensions and Benefits that you should keep with your important papers.

Final Salary — for noncontributory group life insurance, “Final Salary” means the salary on which your JRS pension contributions are based as of the date of your death or retirement.

Noncontributory Group Life Insurance Coverage for Active Members 

If your death occurs in active service before retirement, your named beneficiary (or estate where there is no named beneficiary) will receive a death benefit equal to 1½ x Final Salary.

Noncontributory Group Life Insurance Coverage for Retired Members

Noncontributory group life insurance coverage is available in retirement to JRS retirees with at least 10 years of service credit in the JRS or to those who retire on a Disability Retirement.

Service and Early Retirees — if you die after retirement, your named beneficiary (or estate where there is no named beneficiary) will receive an amount equal to ¼ x Final Salary.

Deferred Retirees — your noncontributory group life insurance coverage is not in effect between the time you terminate judicial service and your Deferred Retirement date. If you die between the time you terminate your judicial service and your retirement date, the last named beneficiary will receive only the return of your pension contributions with interest. There is no other death benefit under these circumstances.

Disability Retirees — If you die while on a Disability Retirement before reaching age 60, your named beneficiary (or estate where there is no named beneficiary) will receive an amount equal to 1½ x Final Salary. If you die at age 60 or older, your named beneficiary (or estate where there is no named beneficiary) will receive an amount equal to ¼ x Final Salary.

Choosing a Beneficiary

Your JRS enrollment application contains a section in which you name beneficiaries for both your noncontributory group life insurance benefits and return of your pension contributions. You may name any person, organization, your estate or a trust as beneficiary.

At retirement, you are asked to nominate noncontributory group life insurance beneficiaries on your Application for Retirement Allowance. This will supercede any beneficiaries previously named for your noncontributory group life insurance.

You may also change your life insurance beneficiary designation at any time during your active or retired membership by filing a Designation of Beneficiary form. The form can be obtained from your employer, or over the Internet at: www.state.nj.us/treasury/pensions

For your protection, beneficiary designations cannot be accepted over the telephone or through a letter. All beneficiary designation forms must be signed and sent to the Division of Pensions and Benefits.

Members enrolled in the contributory plan must change their beneficiary designation with that plan separately. Contact the Prudential Insurance Company of America, Group Life Services, PO Box 948, Horsham, PA 19044, or call 1-800-524-0542.

Payment of Noncontributory Group Life Insurance

Active members can complete a Designation of Beneficiary form to designate how their noncontributory group life insurance benefits will be paid (group life insurance for retirees is paid in a lump sum). If you choose lump sum, your beneficiary can elect another payment option upon your death. The options are:

Death benefits cannot be paid until all the necessary information and forms have been received by the Division of Pensions and Benefits. To report a death, contact the Judicial Retirement System at (609) 292-5175.

Noncontributory Group Life Insurance and Leave of Absence

Your noncontributory group life insurance coverage will continue in full force for an official leave of absence without pay under the following conditions:

Taxation of Group Life Insurance Benefits

The Internal Revenue Service classifies all employer-provided life insurance coverage over $50,000 as a fringe benefit subject to taxation. The amount of life insurance coverage is not taxable, but rather the premium required to pay for the life insurance coverage is taxable. Chapter 62, P.L. 1994 permits members of the State retirement systems to waive their noncontributory group life insurance over $50,000 to avoid a possible federal and State tax liability on that benefit. Any member, who waives the noncontributory group life insurance, must waive the total amount of noncontributory coverage in excess of $50,000. The waiver of partial amounts is not permitted.

IRS Premium Rates* In Effect 2001
(Annual cost per $1,000 of coverage)      

AGE PREMIUM
Under age 25 $ 0.60
25-29 0.72  
30-34 0.96  
35-39 1.08
40-44 1.20
45-49 1.80
50-54 2.76
55-59   5.16
60-64 7.92
65-69    15.24
70 and above 24.72

   *These rates are subject to change by the IRS.

To determine the taxable amount subtract $50,000 from your noncontributory life insurance coverage. The premium rates are then applied to the remaining life insurance amount. The premium costs for the life insurance are determined by the IRS based on your age and the life insurance in excess of $50,000.

Example: A JRS member is age 52 and has noncontributory group life insurance coverage of 1½ times salary.

The member’s annual base salary is $100,000. The member’s life insurance coverage totals $150,000 (1.5 X $100,000).

The fringe benefit amount is determined by subtracting $50,000 from the total benefit amount, $150,000. That leaves $100,000 ($150,000 - $50,000).

According to the IRS, the premium cost for an individual 52 years of age is $2.76 per $1,000 of coverage. The premium cost in this example is $276.00 (100 X $2.76) and would be added to the member‘s taxable income.

You may waive your noncontributory group life insurance coverage by completing a waiver form and submitting it to the Division of Pensions and Benefits. The waiver form must be received by the Division before December 31 to be effective January 1 of the next calendar year. Once a waiver form has become effective it shall be irrevocable for the entire calendar year. The waiver will remain in effect until you submit a reinstatement form to the Division of Pensions and Benefits. The reinstatement will become effective the following January 1.

Waiver and reinstatement forms are available from the Division of Pensions and Benefits or from the Human Resources Office of the Administrative Office of the Courts.

If a waiver is in effect at the time of termination of judicial service or retirement, you will not be permitted to convert any amount of your noncontributory group life insurance coverage over $50,000 (see “Conversion of Group Life Insurance” ).

Before completing the waiver, you should completely understand the ramifications of waiving your noncontributory group life insurance. For more information, refer to Internal Revenue Service Publication 525, Taxable and Non Taxable Income.

Conversion of Group Life Insurance

Contributory Group Term Life insurance coverage ends 31 days after you cease judicial service — whether for reasons of retirement or termination of judicial service — or when the period of coverage under a leave of absence without pay ends.

Contributory Guaranteed Variable Universal Life (GVUL) insurance is “portable coverage.” This means that coverage can be continued after retirement or if you leave judicial service, at your own cost, by contacting Prudential at 1-800-354-6903.

Noncontributory group life insurance coverage is reduced at retirement if you retire with at least 10 years of service credit in the JRS.* Otherwise, noncontributory group life insurance coverage ends 31 days after you cease judicial service or when the period of coverage under a leave of absence without pay ends.

*If you retire on a Disability Retirement the 10-year minimum is waived and the noncontributory insurance is not reduced until you reach age 60.

You have the option to convert any contributory Group Term Life insurance or your noncontributory group life insurance coverage, without a medical examination and at your own expense, to an individual policy from the Prudential Insurance Company when you retire, terminate judicial service, or lose coverage while on a leave of absence without pay. This conversion to a Prudential policy is guaranteed (you cannot be denied coverage for health or other reasons), but it may be more expensive or less suitable to your needs than other policies for which you may qualify from Prudential or other insurance carriers. You may wish to contact other insurance carriers and compare the available policies and costs before you decide to purchase the conversion policy. (Other carriers may accept or reject your application based on their evaluation of the status of your health and other factors.) If you wish to purchase a conversion policy, you have a one-time option to do so prior to the 31st day after you cease judicial service or coverage under a leave of absence ends (see exception under “Disability Retirement”). After that date, you will not be eligible to purchase a conversion policy.

You may convert your contributory Group Term Life insurance or noncontributory group life insurance to any individual, non-group policy customarily offered by Prudential. However, you cannot convert to term insurance or a policy containing disability benefits. Under a guaranteed conversion, the premiums you would pay would be at Prudential’s “standard” rates for the type of policy to which you would be converting rather than the “preferred” rates that would be used for applicants in good health. The individual policy will be effective at the end of the 31-day conversion grace period. If you do not convert to an individual policy by the end of the 31-day period, your coverage will end. To initiate the purchase of a conversion policy, you must contact the Prudential Insurance Company (not the Division of Pensions and Benefits) through any of its local offices or, if you live in New Jersey, by calling 1-800-262-1112. You will need to provide your group insurance policy numbers which are G-14800 for the noncontributory policy and G-94368 for the contributory policy.

The conversion policy can be for any amount of insurance up to the amount that you had while in judicial service, except that in the case of a retirement, the maximum amount that you can purchase will be reduced by the amount of any life insurance that you will automatically receive in retirement under your retirement plan.

Please note that you have 31 days after termination of judicial service to take advantage of the conversion privilege. To protect your conversion privilege it is suggested that you send your application for conversion to Prudential with at least one month’s premium, at the time you terminate judicial service or file your retirement application with the Division of Pensions and Benefits.

The following sections provide more detailed information about conversion policies under specific situations.

Conversion: Retirement

Service or Early Retirement

If you retire with a Service or Early Retirement, and your noncontributory group life insurance is in force at retirement, it will be reduced to ¼ x Final Salary. You will automatically be covered by this insurance and do not need to do anything to qualify.

The reduction of your life insurance coverage will be effective 31 days after your judicial service ceases. If you wish to supplement this coverage with either a conversion policy from Prudential or another type of policy from Prudential or another insurance carrier, it would be best to begin exploring your options at least four months prior to your retirement.

Example: If your Final Salary at retirement was $100,000 your noncontributory group life insurance death benefit as an active member would be $150,000 (1.5 x Final Salary). Once you retire that benefit would be reduced to $25,000 (¼ x Final Salary) providing you qualify for insurance coverage in retirement. If you decide to convert your coverage, you could purchase up to $125,000 ($150,000 - $25,000) worth of coverage (plus up to the amount of any contributory Group Term Life insurance that was in effect at your retirement).

Deferred Retirement

If you retire on a Deferred Retirement, your noncontributory group life insurance coverage will end 31 days after termination of judicial service. Any noncontributory group life insurance coverage to which you are entitled upon retirement will not take effect until you reach age 60 and begin to receive retirement benefits. In addition, any contributory Group Term Life insurance in effect will also end 31 days after termination of judicial service.

You have the one-time option to purchase a conversion policy prior to the 31st day after termination of judicial service (not at the time that you reach normal retirement age). The maximum amount of coverage that you may purchase will be the difference between the amount of coverage you had while in judicial service and the amount of coverage that you will automatically receive when you begin to receive retirement benefits.

Disability Retirement

Your noncontributory group life insurance coverage will continue while your Disability Retirement benefits are being processed provided that the retirement application was filed within 30 days of ending your judicial service.

If you are approved for a Disability Retirement, you will automatically be covered by noncontributory group life insurance equal to 1½ x Final Salary until you reach age 60. Once you reach age 60, or if you are already age 60 or older, your noncontributory group life insurance will be reduced to ¼ x Final Salary. You will have the option to purchase a conversion policy for your noncontributory group life insurance up until the day you reach age 60 (or 31 days after your retirement date if you are age 60 or older). The maximum amount of coverage that you may purchase will be the difference between the amount of noncontributory group life insurance coverage you had while in judicial service and the amount of coverage that you will automatically receive when you reach the normal retirement age of 60.

In addition, any contributory Group Term Life insurance you have in effect will also end 31 days after termination of judicial service. To continue this coverage, you must contact Prudential about a conversion policy within 31 days of your termination of judicial service.

Conversion: Termination of Employment or Leave of Absence

If you terminate judicial service without applying for retirement or your insured period during a leave of absence expires, you will continue to be covered for the next 31 days. Up until the end of that 31-day period, you may convert your noncontributory group life insurance and any contributory Group Term Life insurance, without medical examination, to any individual policy customarily offered by Prudential except term insurance or a policy containing disability benefits.

Example: If your Final Salary at the time of your separation or leave of absence was $100,000, your death benefit would be $150,000 (1.5 x Final Salary). If you decide to convert your coverage, you could purchase up to $150,000 worth of life insurance (plus up to the amount of any contributory Group Term Life insurance that was in effect at your retirement).

WITHDRAWAL FROM THE RETIREMENT SYSTEM

When Membership Ends

Your active membership in the JRS ends if:

If your membership has been inactive for two years and you have not filed for and received a withdrawal of contributions, the Division of Pensions and Benefits will send an expiration notice to your last known address (and a copy to your last employer in case they have a more current address) to remind you that your money is still in the system. You should then file a withdrawal application since contributions left in the system for over two years do not accrue interest.

Should you return to JRS covered employment before the 2-year period ends, you have the option of resuming contributions to your account, if you otherwise qualify. Should you return to covered employment after your account has expired or you have withdrawn your account, you will be treated as a new member of the JRS in all respects. Service credit from a former membership may be purchased by members returning to the system after withdrawal of a former account.

Exceptions

Your membership will not end two years after your last contribution if you are granted an official leave of absence beyond the two-year period.

If your leave of absence extends beyond two years, your inactive membership can be extended up to 10 years. You must submit documentation from the judiciary showing that your leave of absence was officially extended or that your judicial service was not terminated voluntarily or for cause for this extension to be granted. If you return to judicial service covered by JRS during that extended period of inactive membership, your account would be activated and you would then be eligible for a retirement allowance, provided you meet the qualifications for retirement.

Withdrawing Contributions

If you terminate judicial service before retirement, you may withdraw all your contributions and accumulated interest less any outstanding loan or other obligations. You may withdraw only the money you have contributed and no partial withdrawal is permitted. Upon your withdrawal, all rights and privileges of membership end. Since the employer/employee relationship must be severed, no withdrawal will be paid if there are unresolved legal matters concerning your termination of employment. To withdraw, you must file a properly completed Application for Withdrawal which is available from the Human Resources Office of the AOC or from the Division of Pensions and Benefits.

In accordance with federal law, income tax must be withheld on certain pension distributions that produce an annual taxable income of $200 or more unless the taxable amount is directly rolled over into an individual retirement arrangement (IRA) or a new employer’s retirement plan (if applicable). To qualify, this direct rollover must occur within 60 days of the withdrawal check date. If payment is made directly to you, the taxable portion is subject to 20 percent federal income tax withholding. In addition, if you receive payment before you reach age 59½ and you do not roll it over, you may have to pay an extra tax equal to 10 percent of the taxable portion of any payment. If you have any questions concerning this federal law, call the Internal Revenue Service at 1-800-TAX-1040.

If you are age 60 or have at least five years of judicial service and at least 10 years in the aggregate of public service credit when you file for withdrawal, you must waive any rights you have to a retirement or death benefit. This written waiver is part of a letter which states the amount of retirement and death benefits to which you are entitled if you do not withdraw. 

APPEALS

If you wish to appeal any administrative decision of the Division of Pensions and Benefits, address your appeal to:

Secretary to the State House Commission
Judicial Retirement System
NJ Division of Pensions and Benefits
PO Box 295
Trenton, New Jersey 08625-0295

If your request is denied by the State House Commission, you will be notified that you have 45 days in which to file for a hearing. If the issue involves disputed matters of fact, the Commission will approve such a hearing and the matter will be referred to the Office of Administrative Law where an administrative law judge will schedule the hearing. You may wish to be represented by an attorney since this is a legal proceeding.

If the matter is heard by an administrative law judge, recommendations will be presented to the State House Commission. If the Commission affirms its original decision and denies your request, you will have an opportunity to appeal to the courts.

Benefits and provisions of the system are subject to changes by the legislature, courts, and other officials. While this booklet outlines the benefit and contribution schedules of the Judicial Retirement System, it is not a final statement. Complete terms governing any judicial benefit program are set forth in the New Jersey Statutes Annotated. Regulations, new or amended, are published in the New Jersey Register by the State Office of Administrative Law supplementing the New Jersey Administrative Code.

PLAN INFORMATION

Name of Plan

The Judicial Retirement System of New Jersey.

Administration

The Judicial Retirement System is a defined benefit plan administered by the New Jersey Division of Pensions and Benefits, PO Box 295, Trenton, New Jersey 08625-0295, (609) 292-3678.

Provisions of Law

The Judicial Retirement System was established by New Jersey Statutes and can be found in the New Jersey Statutes Annotated, Title 43, Chapter 6A. Changes in the law can only be made by an act of the State Legislature. Rules governing the operation and administration of the system may be found in Title 17, Chapter 10 of the New Jersey Administrative Code.

Funding

The funds used to pay benefits come from three sources: State contributions, employee contributions, and investment income from those contributions.

Plan Year

For record keeping purposes the plan year is July 1 through June 30.

Service of Legal Process

Legal process may be served on the Director of the Division of Pensions and Benefits, the administrator of the system.

Employment Rights Not Implied

Membership in the Judicial Retirement System does not give you the right to be retained in service for the judiciary, nor does it give you a right of claim to any benefit you have not accrued under terms of the system.

CONTACTING THE ADMINISTRATIVE OFFICE OF THE COURTS AND THE DIVISION OF PENSIONS AND BENEFITS

Telephone Numbers:

To talk with a Judges Benefits Aide in the Human Resources Office of the Administrative Office of the Courts  call (609) 292-4687.

To talk with a Pensions Representative about your JRS benefits call (609) 292-5175 weekdays between 9 a.m. and 4 p.m. (except State holidays).

To talk with a specialist about the State Health Benefits Program, call (609) 292-7524 weekdays between 8:30 a.m. and 4 p.m. (except State holidays). If you are hearing impaired, call the TDD at (609) 292-7718. 

To speak with a plan representative about the Supplemental Annuity Collective Trust (SACT), call (609) 633-2031, or for Deferred Compensation, call (609) 292-3605 weekdays between 8:15 a.m. and 4:30 p.m. (except State holidays). They can answer your questions about the Plans and provide enrollment and distribution forms.

If you are a retired member who needs to change your mailing address, call (609) 292-MOVE (6683) weekdays between 9 a.m. and 4 p.m. (except State holidays). You can change your address over the telephone.

Mailing Address:

On all correspondence, be sure to include your membership number or Social Security number.

Judicial Retirement System
Division of Pensions and Benefits
PO Box 295
Trenton, NJ 08625-0295

Counseling Services:

The Division of Pensions and Benefits offers individual counseling services to members of the retirement systems and other benefit programs. Counselors are available by appointment Monday through Friday from 7:40 AM to 3:40 PM. Counseling appointments can be made online at: www.state.nj.us/treasury/pensions

The office is located at:

One State Street Square
50 West State Street, 1st Floor
Trenton, NJ

Directions to the office

Internet and E-Mail:

Most publications of the Division of Pensions and Benefits can be found on the Internet at: www.state.nj.us/treasury/pensions or you may e-mail the Division at: pensions.nj@treas.state.nj.us

DIRECTIONS TO THE DIVISION OF
PENSIONS AND BENEFITS

The Division of Pensions and Benefits is located at 50 West State Street (One State Street Square) which is a half-block east of the State House. The directions below will take you to the parking garage next door to the Division of Pensions and Benefits. You must pay to park in the parking garage.

When leaving the garage, you will be facing the side of One State Street Square. Turn left and walk to the front entrance of the building (on West State Street). “Check in” with the guard in the main lobby where you will be directed to the Office of Client Services.

From Northeast New Jersey via the NJ Turnpike

Take the NJ Turnpike South to Exit 7A. Follow I-195 West until it ends, then follow signs for Route 29. After passing through a tunnel and two traffic lights, take the Calhoun Street exit. At the first traffic light, turn right onto West State Street. After passing through a traffic light turn left at the next corner onto Chancery Lane. One-half block up is a multilevel parking garage on the left. You must pay to park here. See “When leaving the garage” to get to the office.

From Northeast New Jersey via Route 1

Take Route 1 South toward Trenton. Just north of Trenton Route 1 splits into two roads. Stay to the left (do not use Route 1 Alternate). From Route 1 take the Perry Street exit. At the end of the exit ramp, turn left onto Perry Street. At the fourth traffic light after turning onto Perry Street turn left onto Warren Street. At the second light, turn right onto West State Street. At the next corner turn right onto Chancery Lane. One-half block up is a multilevel parking garage on the left. You must pay to park here. See “When leaving the garage” to get to the office.

From Northwest New Jersey

Take Route 31 South to I-95 South to Exit 1 (Route 29). Follow Route 29 South for five miles to the Calhoun Street exit. At the first traffic light, turn right onto West State Street. Pass the State House and the next light. At the next corner, turn left onto Chancery Lane. One-half block up is a multilevel parking garage on the left. You must pay to park here. See “When leaving the garage” to get to the office.

From Southern New Jersey

If using the Turnpike, take exit 7A and follow the directions from Northeast New Jersey via the NJ Turnpike.

If using I-295 North, take exit 60 to Route 29 and follow the directions for using Route 206 North (below) beginning with Route 29.

If using Route 206 North, about four miles before reaching center-city Trenton take the I-295 exit but, once on the interstate highway, follow the signs for Route 29, not I-295. After passing through a tunnel and two traffic lights, take the Calhoun Street exit. At the first traffic light, turn right onto West State Street. After passing through a traffic light turn left at the next corner onto Chancery Lane. One-half block up is a multilevel parking garage on the left. You must pay to park here. See “When leaving the garage” to get to the office.

From the New Jersey Shore

Take I-195 West, then follow the directions from Northeast New Jersey via the NJ Turnpike.


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Last Updated: May 3, 2006