SL 50001.570 Effect of Mandatory Coverage on Section 218 Coverage

Revised language to be more in line with recent changes in language in SL 40001.465B.

Subsection F — ERROR MODIFICATIONS, revised to read as follows:

An error modification should list the date the coverage error began as the effective date regardless of whether the coverage error began prior to, on, or after July 1, 1991 (see SL 40001.465B). Coverage will continue from the effective date forward.

 

SL 30001.345 Police Officers and Firefighters

The purpose of the revision is to give a more complete description of the steps the State must take to revise “State law” and the “Federal-State agreement” in order to permit Section 218 Social Security coverage of police officer and firefighter positions already under a retirement system.

Subsection E.1., 3rd paragraph, revised to read as follows:

1. Current Law

Effective for modifications filed after August 15, 1994, all States may provide coverage for police officer and firefighter positions under a retirement system by use of the majority vote referendum procedure. The retirement system coverage group consists of all current and future employees in positions under the retirement system in which the referendum was held, including ineligibles.

In addition, those States and all interstate instrumentalities authorized under Section 218(d)(6)(C) of the Act, may also use the divided vote procedure. If the divided vote procedure is used, the retirement system coverage group consists of all members who chose coverage and future members except that "ineligibles" may not be covered as a part of such a group.

Congressional authorization alone is not sufficient to provide Social Security coverage to police officer and firefighter positions under a retirement system. As with other retirement system—covered positions, there must also be authority to provide coverage under State law and the Federal-State Section 218 Agreement.

The State must first review state statutes and its enabling act to see if existing language prohibits extending Social Security coverage under the Section 218 Agreement to police officer and firefighter positions under a retirement system. If this language exists, the State must remove it, which usually requires action by the state legislature. Once the legislature passes corrective legislation, or if there is no prohibitive language to correct, then the State must modify the Section 218 Agreement to permit coverage of police officer and firefighter positions already covered by a retirement system, see template in SL 40001.490, Exhibit 30. Only then, can the State begin holding referendums and extending coverage to those positions.

Before holding the referendum, the state must decide what the retirement system will be fore referendum and coverage purposes. In addition to the choices of what shall constitute a retirement system under the majority vote and divided vote procedures, the State has additional choices for covering police officers and firefighters. It may deem:

• •

  the police positions only to be the retirement system;

• •

  the firefighter positions only to be the retirement system; or

• •

  the positions of police officers and firefighters to be the retirement system.

SL 40001.465 Modifications to Correct Errors

Subsection B., replaced first paragraph to read:

An error occurs when a state or local government entity mistakenly believes that an employee’s position is subject to FICA and begins withholding and reporting wages. Reporting may be erroneous for Section 218 purposes even if, at the time of the error, the employee is eligible to receive provisional coverage under the Section 210 mandatory rules. The nature of the error depends on the entity’s belief and intent, which may be inferred from the circumstances.

Subsection B., 2nd sentence, added the word “position” to read “retirement system position.”

Subsection B., 3rd sentence, revised to read:

If the position was not under a retirement system at the time the error was made, the coverage group would be covered as an absolute coverage group under Section 218(b)(5) of the Act and a referendum would not be necessary.

SL 30001.357 Optional Exclusions

The Office of Actuary recently published the new election official/worker threshold amount effective January 1, 2016. This is the first change in the threshold amount since 2013.

Subsection C., 2nd paragraph, deleted last sentence and replaced with the following:

Prior to the 1967 Social Security Amendments, there was no specific provision for the exclusion of election officials and election workers. The exclusion was possible by excluding election officials/workers as a class of part-time positions.
Effective January 1, 1968, the Act was amended to allow each State to modify its agreement to exclude the services of election officials/workers whose pay in a calendar quarter was less than $50. For years 1978 through 1994, the threshold amount was $100 a calendar year. The threshold amount was $1,000 for years 1995-1999. The election worker threshold amount for calendar years 2000 and 2001 was $1,100; for the calendar years 2002 through 2005, the election worker threshold amount was $1,200; for calendar years 2006 through 2007, the election worker threshold amount was $1,300; for calendar year 2008, the threshold amount was $1,400; and for calendar years 2009 through 2012, the threshold amount was $1,500. For calendar years 2013 through 2015, the threshold amount was $1,600. Beginning January 1, 2016 and going forward, the election official/worker threshold amount increases to $1,700 a calendar year.

SL 40001.490 Agreement and Modification Exhibits

Subsection I. added new subsection:

I. Miscellaneous Modification Situations  

Exhibit 30: Amending Section 218 Agreement Language to Permit Coverage for Police Officer and Firefighter Positions under Retirement Systems

SL 40001.420 Modifications to the Original Agreement

Subsection E. Notification of approval

Subsection E.2. 4th bullet — Deleted mailing address of IRS (IRS, SE: T:GE:FSL:CPM:7241, 300 E. 8th St., MS 4098AUS, Austin, TX 78701-3233) and added instructions to FAX the modification packets to IRS at 855-243-4014

SL 40001.420 Modifications to the Original Agreement

Subsection E. Notification of approval

Subsection E.2. — Updated OISP address by deleting the #166.