Iowa Code 97B.11A – Pickup of employee contributions
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1. Notwithstanding section 97B.11 or other provisions of this chapter, beginning January 1, 1995, for federal income tax purposes, and beginning January 1, 1999, for state income tax purposes, member contributions required under section 97B.11 which are picked up by the employer shall be considered employer contributions for federal and state income tax purposes, and each employer shall pick up the member contributions to be made under section 97B.11 by its employees. Each employer shall pick up these contributions by reducing the salary of each of its employees covered by this chapter by the amount which each employee is required to contribute under section 97B.11 and shall pay the amount picked up in lieu of the member contributions as provided in section 97B.14.
Terms Used In Iowa Code 97B.11A
- Contributions: means the payments to the fund required herein, by the employer and by the members, to provide the benefits of the retirement system. See Iowa Code 97B.1A
- Employee: means an individual who is employed as defined in this chapter for whom coverage under this chapter is mandatory. See Iowa Code 97B.1A
- Employer: means the state of Iowa, the counties, municipalities, agencies, public school districts, all political subdivisions, and all of their departments and instrumentalities, including area agencies on aging, other than those employing persons as specified in subsection 8, paragraph "b" subparagraph (7), and joint planning commissions created under chapter 28E or 28I. See Iowa Code 97B.1A
- Member: means an employee or a former employee who maintains the employee's or former employee's accumulated contributions in the retirement system. See Iowa Code 97B.1A
- state: when applied to the different parts of the United States, includes the District of Columbia and the territories, and the words "United States" may include the said district and territories. See Iowa Code 4.1
- wages: includes amounts that can be received in cash in lieu of employer-paid contributions to such plans, if the election is uniformly available and is not limited to highly compensated employees, as defined in section 414(q) of the Internal Revenue Code. See Iowa Code 97B.1A
2. Member contributions picked up by each employer under subsection 1 shall be treated as employer contributions for federal and state income tax purposes only and for all other purposes of this chapter shall be treated as employee contributions and deemed part of the employee’s wages or salary.