(a) For all state compensation earned by judicial officers who are members of the retirement system, the state shall pick up the member contributions required by § 840.102 or 840A.101, as applicable. The state shall pay the picked-up contributions to the retirement system from the same source that is used in paying state compensation to the judicial officer members. These payments are in lieu of contributions by the members. The state shall pick up these contributions by a corresponding reduction in the cash salaries of the members, by an offset against a future salary increase, or by a combination of a salary reduction and offset against a future salary increase. Members do not have the option of choosing to receive the contributed amounts directly instead of having them paid by the state to the retirement system.
(b) Contributions picked up as provided by Subsection (a) shall be treated as employer contributions in determining tax treatment of the amounts under the United States Internal Revenue Code; however, the state shall continue to withhold federal income taxes on these picked-up contributions until the Internal Revenue Service determines or the federal courts rule that pursuant to Section 414(h) of the Internal Revenue Code of 1986 (26 U.S.C. § 414(h)) these picked-up contributions are not includable as gross income of the member until the time that they are distributed or made available.

(c) Member contributions picked up as provided by Subsection (a) shall be transmitted to the retirement system in the manner required by § 840.102. Member contributions picked up by the state shall be credited to the members’ individual accounts and treated for all other purposes as if the amounts were a part of the members’ compensation and had been deducted as provided by § 840.102 or 840A.101, as applicable.