January 29, 2016


In This Issue: General Memo 659: Impact of 2015 Investment Return on Employers January Employer Reminder: 2016 Employer Rates IMRF and IRS Form W-2	Quick Links: Visit IMRF's website Log in to Employer Access Employer Digest email archive

General Memo 659:

Impact of 2015 Investment Return on Employers

The estimated 2015 investment return for IMRF is 0.32%, which fell short of the 7.5% target. This return translates into investment income of approximately $147.43 million, after investment and administrative expenses.

The Illinois Pension Code requires IMRF to annually credit 7.5% interest to the IMRF member and annuitant reserves. Because the IMRF portfolio did not return 7.5% in 2015, the required funds are drawn from IMRF employers' reserve accounts. This reflects the fact that, as sponsors of a defined benefit pension plan, IMRF employers share all the risks and rewards of investment returns.

Therefore, approximately $2.62 billion will be withdrawn from the employer reserve accounts, an average reduction of 21.32% from beginning of the year balances. This preliminary information is based on unaudited investment return data and projected actuarial information. Final information will be available in May 2016.

IMRF will present an Employer Rate Meeting series in April 2016. These meetings will be held throughout the state, and will further discuss the impact of year-end financial and actuarial data on IMRF and its estimated impact on individual employers. The same information will be presented in an online webinar in May 2016. Details and registration information for the meetings and webinar will be available on IMRF's website, www.imrf.org, and in upcoming editions of Employer Digest.

Refer to General Memo 659 for further information on the impact of the 2015 investment return on employer funding status.

January 2016 Employer Reminder:

2016 employer rates and maximum IMRF wages

In November 2015, IMRF provided a Final Rate Notice for 2016 to all Authorized Agents. This notice detailed each employer's 2016 rate.

January is the first month employers will calculate employer contributions using their 2016 employer rate. It is also an appropriate month to review maximum IMRF wages, which vary by the applicable Tier.

Learn more about 2016 employer rates in the January 2016 Employer Reminder.

IMRF and IRS Form W-2

It may be time to review the steps employers should take to fill out IRS Form W-2 for employees who are eligible to participate in IMRF.

IMRF Tax Letter #17 explains how to fill out IRS Form W-2, "Wage and Tax Statement," for any employee who is participating in or eligible to participate in IMRF. This letter is part of a library of Tax and Topic Letters available for review and download on IMRF's website, www.imrf.org, that address tax issues and other topics related to IMRF benefits.

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