Section ETF 20.03 - Annuity computations(1) For purposes of annuity computations, an applicant's age shall be determined to the nearest month.(2) For purposes of determining maximum benefits under s. 40.23 (2), Stats., and accelerated benefits under s. 40.24 (4), Stats., except as provided to the contrary in s. ETF 20.35 (4) (c), the estimated OASDHI benefit shall be based on the following: Note: 2007 Wis. Act 131 revised s. 40.24 (1) (e), Stats., for annuities effective after July 1, 2008 to remove the alternative provision terminating the temporary annuity portion of the benefit at death and thereby made the temporary annuity an annuity certain payable until the annuitant would have reached age 62. Once called "Social Security Integrated" or "integrated" annuities, these two-part annuity options are now known as accelerated annuity options. This rule (CR 09-057) updates the last remaining reference in the administrative rules to an "integrated" annuity benefit.
(a) It shall be assumed that the employee has been in a position covered under OASDHI from the year in which age 30 was attained to the year of retirement or death, except that years in which earnings are reported under s. 40.05 (1) (a) 4, Stats., shall not be counted.(b) It shall be assumed that covered earnings increased from the year in which age 30 was attained to the year of retirement or death at a rate determined by the actuary to reflect changes in the OASDHI wage base and approximate average changes in earnings during that time.(bm) With respect to accelerated annuity options under s. 40.24 (1) (e), Stats., or s. ETF 20.04 (3), that become effective on or after July 1, 2008, the temporary annuity portion is payable in all cases until the annuitant reaches, or would have reached, age 62, without regard for an earlier date of death. The actuary shall make all tables, other assumptions and calculations relevant to the accelerated annuity benefit accordingly. Note: 2007 Wis. Act 131 revised s. 40.24 (1) (e), Stats., for annuities effective after July 1, 2008 to remove the alternative provision terminating the temporary annuity portion of the benefit at death and thereby made the temporary annuity an annuity certain payable until the annuitant would have reached age 62. This rule (CR 09-057) requires the actuary's assumptions, tables and calculations to take into account that the temporary portion of future accelerated annuity benefits will be an annuity certain.
(c) The delayed retirement credit under federal social security regulations shall be applied to each year after age 65 and up to age 72.(d) Based upon the assumptions in pars. (a) to (c) and in accordance with the provisions of the federal social security act, the actuary shall prepare a table correlating the employee's age and final average earnings with a primary OASDHI benefit, adjusting the table as necessary to prevent, in most cases, assumed OASDHI benefits from exceeding actual OASDHI benefits.(e) Notwithstanding pars. (a) to (d), if the applicant furnishes the official social security award certificate or a letter from the social security administration which shows that the retirement or disability benefit that is first payable from the participant's OASDHI account at the time of application for Wisconsin retirement system benefits is or will be in a different amount, the amount certified by the social security administration shall be used in the benefit computation.(3) The actuarial factors used in computing annuities for beneficiaries shall be the same as the factors used in computing retirement annuities. For purposes of computing a beneficiary accelerated payment annuity the beneficiary's estimated OASDHI benefit shall be the primary OASDHI benefit amount determined for the deceased participant pursuant to sub. (2).(4)(a) When the earnings of a state elected official whose final average earnings are subject to s. 40.02 (33) (b) 1 or 2., Stats., are paid on a payroll schedule other than monthly, the final average earnings used to calculate benefits under ss. 40.23, 40.63 and 40.73 (1) (c), Stats., shall be calculated by multiplying the participant's hourly rate of pay at the time of termination of employment from state elected official service by 2,080, then dividing the result by 12.(b) The final average earnings calculated under par. (a) shall not be used to calculate benefits based on creditable service granted in any category of employment other than that as a state elected official.Wis. Admin. Code Department of Employee Trust Funds ETF 20.03
Renum. from ETF 7.01(2), 7.03 and 7.06 and am. Register, December, 1983, No. 336, eff. 1-1-84; r. and recr. (2) (a) and (b), Register, December, 1990, No. 420, eff. 1-1-91; CR 01-096: am. (3), Register December 2001 No. 552, eff. 1-1-02; CR 09-057: am. (2) (intro.), cr. (2) (bm) and (4) Register May 2010 No. 653, eff. 6-1-10.Amended by, correction in (2) (intro.) made under s. 13.92(4) (b) 7, Stats., Register May 2021 No. 785, eff.6/1/2021Amended by, CR 23-023: am. (1) Register May 28 No. 821, eff. 6/1/2024This rule (CR 09-057) codifies the department's long-standing practice for calculating the final average earnings for state elected officials and ensures the practice is consistent for calculating retirement annuities, disability annuities, and death benefits.