Withdraw Your ERS Retirement

Withdraw Your ERS Retirement

If you are actively employed with the state you can’t withdraw or borrow from your retirement account. If you are vested and separate from state employment you can leave your account with ERS. Be sure to contact ERS to start the retirement process when you are first eligible. Your annuity amount will not increase after you’ve separated from employment. However, your ERS retirement account balance will continue to accrue 2% interest every year.

Your options: 

  • Leave your funds at ERS (they continue to accrue 2% interest each year).
  • Withdraw your entire account balance.
  • Roll over your entire account balance to a qualifying account.
  • A combination of a withdrawal and a rollover. 

If you decide to withdraw your account balance: 

  • ERS will begin processing your withdrawal payment only after you have been off state payroll for 30 days from your last date of state service. Your agency is responsible for notifying ERS of your last date of state service.
  • Direct deposit isn’t an option. ERS will mail your check to the address you provide. You will receive a notification from ERS via mail or email about when to expect your check.
  • Federal law requires 20% be withheld from any amount paid directly to you. Any portion rolled over to a qualified pre-tax account won’t be taxed the 20% up front.
  • You must withdraw all of the funds in your account.  You cannot leave a portion of your funds in your retirement account or borrow from it. 
  • You lose your ERS membership, service credit and your retirement eligibility rules may not be the same if you return to state service. 
  • You can purchase your withdrawn service credit if you return to state service (paying 10% interest for each fiscal year) or work for an employer under the Proportionate Retirement Program (PRP)

If you roll over your funds: 

When you leave state employment, you can move your money to another retirement account (like an individual retirement account (IRA) or qualified employer plan) without being taxed 20% up front. If you process a direct rollover:

  • ERS will begin processing your withdrawal payment only after you have been off state payroll for 30 days from your last date of state service. Your agency is responsible for notifying ERS of your last date of state service.
  • You must withdraw all of your funds. You can request to roll over all of the funds in your account or request a partial rollover where a portion of the funds are rolled over to a qualified pre-tax account and the other portion is paid directly to you. You lose your ERS membership, service credit and your retirement eligibility rules may not be the same if you return to state service.
  • Direct deposit isn’t an option. ERS will mail your check to the address you provide on your ERS account. ERS will not mail rollover checks to the financial institution.
  • Your withdrawal won’t be taxed in the current year and no income tax will be withheld if you roll over the entire taxable amount. Your money will be taxed later when you take it out of the IRA or the employer plan.
  • The nontaxable portion (any contributions made to your account post-tax) of your withdrawal is not an eligible rollover distribution and can’t be rolled over to another retirement account.
  • Your withdrawal check will be made out directly to your IRA or qualified employer plan. Your withdrawal can’t be rolled over to a Roth IRA, SIMPLE IRA, or education IRA, because these IRAs are not considered Traditional IRAs.
  • You must deposit the rollover payment within 60 days from the date on the check.
  • If you return to state service or work for an employer under the Proportionate Retirement Program (PRP), you can purchase your withdrawn service credit.

Withdrawal Process

You can apply for a withdrawal any time after you have left state employment, but ERS will begin processing your withdrawal payment only after you have been off state payroll for 30 days from your last date of state service. Your agency is responsible for notifying ERS of your last date of state service. We will notify you, via email or mail about when to expect your check. 
To start the process after you stop working for the State:

  1. Sign in to your account.
  2. Select “Withdraw My Retirement Account."
  3. Follow the four easy steps to receive the Retirement Account Withdrawal Disclaimer form.
  4. View the remaining steps, estimate when you will receive your payment, and track the status of it online. 

General Withdrawal timeline:

After the 30 day waiting period from your last date of state service, it takes an additional 15 days before we mail your withdrawal check.  ERS works with the Comptroller of Public Accounts (CPA) to process your payment.