Termination of Employment

Termination of Employment

Once you terminate employment with the County or District and your department HR representative has processed the required paperwork, you will receive a separation packet from VCERA, typically within 2-3 weeks. (Payroll processes may delay VCERA’s receipt of your separation notification up to 2 weeks after your actual separation date.) This section contains information about your retirement account options, which are summarized below:

Options available to all members upon termination of employment

  1. Refund processing occurs at the earlier of either: a) 30 days after VCERA sends you the Special Tax Notice Regarding Plan Payments and Federal Income Tax (Special Tax Notice); or b) 30 days from the date of separation of employment if you elect to waive the Special Tax Notice. 
  2. Apply for reciprocal retirement benefits if you intend to become a member of a reciprocal retirement system within 180 days. Your retirement service credit accrued under all reciprocal systems will be combined to determine when you are vested and when the minimum eligibility requirements are met for receiving a service retirement, unless you are a member of a JRS II and have established limited reciprocity.
  3. Apply for a service-connected disability retirement if you are permanently disabled for the performance of your duties due to job-related injury or disease.
  4. Leave contributions on deposit with VCERA.
  5. Apply for a regular service retirement if the minimum eligibility requirements are met. Deferred non-vested members are eligible for a service retirement once they reach age 70.

Additional options for vested members (five or more years of retirement service credit)

  1. Apply for a service retirement if the minimum eligibility requirements are met.
  2. Apply for deferred retirement benefits.
  3. Apply for a non-service connected disability retirement if you are permanently disabled due to non job-related injury or disease.

Leaving Funds on Deposit

You may elect to leave contributions on deposit with VCERA, which will leave your accumulated service intact. Interest will be credited to your account each June 30 and December 31, unless you separated prior to January 1, 2003 and were not vested.  Contributions may be withdrawn at any time.  Non-vested members become eligible to apply for a retirement benefit from VCERA at age 70, regardless of service. To learn more about vesting, visit our vesting page.

Deferred Retirement Benefits

If you have five or more years of service credit, you may elect deferred retirement status when you separate from County or District service. If you elect a deferred retirement, you must leave your accumulated contributions on deposit with VCERA. You may rescind your deferred retirement election at any time and withdraw your contributions by providing written notice to VCERA.

If on deferred retirement, you will become eligible to begin receiving your retirement benefit from VCERA at the time you would have first become eligible to retire had you remained continuously in County or District service as a full-time employee.

The monthly retirement benefit will not start automatically when you become eligible to retire. You must file an Application for Retirement prior to your desired retirement date in order to begin receiving benefits.

If you are on deferred retirement status and are rehired as a regular employee with the County or District, you will return to active membership in the same tier you were in during your previous service. To be eligible for rehire, you must be separated from service for 180 days, unless the Safety exception in GC 7522.56 is met. You will accrue the same benefits and retain the original membership date and entry age for determining your employee contribution rate. This applies to General Service Tiers. If you were a Safety member and are hired as a General member, contact VCERA for more information.

Withdrawal of Contributions

If you elect to withdraw your retirement contributions, your VCERA membership immediately ends, as does your right to apply for a service, disability, deferred or reciprocal retirement. Therefore, please carefully consider all your options before deciding to withdraw your funds.

You can either refund or roll over your account balance into a qualified plan. Refundable contributions include the amounts you paid into VCERA, any employer-paid portion of employee contributions (if applicable), and the semiannual interest credited on those amounts.

Taxes

VCERA is required to withhold 20% of the taxable portion of any lump-sum distribution greater than $200 for federal tax purposes. The withholding will not apply if you roll over the taxable portion of the distribution to an IRA or qualified employer retirement plan willing to accept a rollover. For more information, download VCERA’s Special Tax Notice.

Disposition Form

To process your withdrawal request, you (and your spouse, if applicable) must sign a Disposition of Retirement Contributions Form and return it to VCERA before a refund of contributions will be issued. The disposition form is available in the VCERA office, but it will also be mailed to you within a few weeks of terminating employment.

If you do not make a written election on the form, you will be placed automatically in a deferred membership status and your contributions will remain on deposit with VCERA. However, you may withdraw your funds at any time by completing a disposition form.

The foregoing is not intended to be tax advice. Please consult a qualified tax professional for more information prior to requesting a withdrawal of your VCERA contributions.