THE PUBLIC SCHOOL EMPLOYEES RETIREMENT ACT OF 1979
Act 300 of 1980
38.1346 Benefits; exemption from taxation; subject to taxation beginning January 1, 2012; offset of retirement benefits or refunds; forfeiture of service credit.
Sec. 46.
(1) Except as otherwise provided in this section, a retirement allowance, an optional benefit, or any other benefit accrued or accruing to a person under this act, the reserves created by this act, and the money, investments, or income of those reserves are exempt from state, county, municipal, or other local tax and are subject to the public employee retirement benefit protection act, 2002 PA 100, MCL 38.1681 to 38.1689.
(2) Beginning January 1, 2012, a retirement allowance, an optional benefit, or any other benefit accrued or accruing to a person under this act is subject to state tax upon distribution to the person from the various funds created by this act.
(3) The retirement system may offset retirement benefits or refunds payable under this act against amounts owed to the retirement system by a member, retirant, retirement allowance beneficiary, or refund beneficiary.
(4) If the retirement system is required by the federal government pursuant to a court order to transmit a part of a member's contributions standing to the member's credit in the reserve for employee contributions to a federal agency, the service credit that is covered by the payment shall be forfeited in the same manner as if the employee had requested and been paid a refund of the member's most recent contributions.
History: 1980, Act 300, Imd. Eff. Oct. 31, 1980 ;-- Am. 1985, Act 40, Imd. Eff. June 13, 1985 ;-- Am. 1989, Act 194, Imd. Eff. Aug. 25, 1989 ;-- Am. 1991, Act 47, Imd. Eff. June 27, 1991 ;-- Am. 2002, Act 94, Imd. Eff. Mar. 27, 2002 ;-- Am. 2011, Act 42, Imd. Eff. May 25, 2011
PopularName Notes:
Act 300
Notes of Decisions
State Treasurer v. Schuster, 547 N.W.2d 332 (Mich. Ct. App. 1996).
· cites it 3× “MCL 38.1346; MSA 15.893(156). Further, plaintiff’s proposed interpretation would subject retirement allowance payments to taxation and bankruptcy or insolvency proceedings once such payments landed in the retirant’s hands.”
Lindner v. Lindner, 358 N.W.2d 376 (Mich. Ct. App. 1984).
· cites it 3× “This is a divorce case in which the trial court granted a declaratory judgment in favor of the wife, ruling that the inclusion of the husband’s teacher’s pension plan as a marital asset for purposes of equitable distribution did not violate MCL 38.1346(1); MSA 15.893(156X1),…”
State Treasurer v. Gardner, 583 N.W.2d 687 (Mich. 1998).
“MCL 38.1346(1); MSA 15.893(156)(1). There, we explained that “the state, when considering pension payments according to the reimbursement act, is not a ‘creditor,’ nor is the relationship between a prisoner and the state a typical debtor-creditor relationship.”
In Re Benton, 237 B.R. 353 (Bankr. E.D. Mich. 1999).
“The WCERS contends that just as Michigan law protects the retirement benefits of state employees, counties should be permitted to include the same protections in their employees’ retirement plans.”
Fulton v. Fulton, 371 N.W.2d 522 (Mich. Ct. App. 1985).
“Defendant was also awarded attorney fees of $1,600. On appeal plaintiff now contends that the property division was in error as his pension should not have been considered a marital asset pursuant to MCL 38.”
— Mich. Comp. Laws § 38.1346(1) — 7 cases
Lindner v. Lindner, 358 N.W.2d 376 (Mich. Ct. App. 1984).
“This is a divorce case in which the trial court granted a declaratory judgment in favor of the wife, ruling that the inclusion of the husband’s teacher’s pension plan as a marital asset for purposes of equitable distribution did not violate MCL 38.1346(1); MSA 15.893(156X1),…”
State Treasurer v. Schuster, 547 N.W.2d 332 (Mich. Ct. App. 1996).
“MCL 38.1346; MSA 15.893(156). Further, plaintiff’s proposed interpretation would subject retirement allowance payments to taxation and bankruptcy or insolvency proceedings once such payments landed in the retirant’s hands.”
State Treasurer v. Gardner, 583 N.W.2d 687 (Mich. 1998).
“MCL 38.1346(1); MSA 15.893(156)(1). There, we explained that “the state, when considering pension payments according to the reimbursement act, is not a ‘creditor,’ nor is the relationship between a prisoner and the state a typical debtor-creditor relationship.”
— Mich. Comp. Laws § 38.1346(4) — 2 cases
State Treasurer v. Schuster, 547 N.W.2d 332 (Mich. Ct. App. 1996).
“MCL 38.1346; MSA 15.893(156). Further, plaintiff’s proposed interpretation would subject retirement allowance payments to taxation and bankruptcy or insolvency proceedings once such payments landed in the retirant’s hands.”
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