FICA alternative retirement plan
The State of Nevada signed a 218 agreement with the Social Security Administration in 1954. Under this agreement the State of Nevada chose to opt out of FICA participation for their employees who qualify for a retirement plan. Employees who participate in any NSHE mandatory retirement plans do not contribute to FICA. There is also no employer contribution to FICA. This means that while employed for the Nevada System of Higher Education (NSHE), you will not be gaining any FICA service credits from NSHE. In addition, your FICA retirement amount received from Social Security could be affected by the retirement you receive from our retirement plans.
How to Participate
As a part-time, seasonal or temporary employee of the State of Nevada, you are required to participate in the State of Nevada FICA Alternative Deferred Compensation Plan. As a FICA Alternative employee, you must contribute 7.5% of your gross compensation per pay period to the Plan. No additional contributions are permitted.
Your contributions are made on a tax deferred basis. You will be taxed on the value of your contributions (including any earnings) when you receive a distribution of your benefits from the Plan.
When You are Eligible to Receive Your Retirement Benefits
Distribution of your Plan benefits can only be made upon:
- Severance from employment
- Attainment of age 70½ (whether or not you are still employed).
A severance from employment occurs when you voluntarily or involuntarily terminate. You may elect to receive your distribution immediately upon severance of employment or defer payment to a later date.
Nevada Deferred Compensation (NDC) Program administers a FICA Alternative Retirement Program. Effective 2015, NDC selected VOYA Financial (formerly ING) to be a sole record keeper for this plan. Please visit NDC website for more information about this plan.