Nevada PERS Retirement Options: Payment Options, Refund, Buyback

Updated October 2, 2026. Quick answer: A Regular member of the Public Employees’ Retirement System of Nevada (NV PERS) chooses at retirement among seven options: Option 1, the Unmodified Allowance, which pays the most and nothing to a beneficiary, and Options 2 to 7, which pay less for life and continue a benefit to the named beneficiary. A married member needs the spouse’s notarized consent or objection on the application. After retirement the beneficiary cannot be changed. A refund cancels all membership rights and service credit. Eligibility ages, the benefit multiplier and the COLA schedule differ by when the member’s membership took effect: before January 1, 2010, from then to before July 1, 2015, or on or after July 1, 2015.

More on public pension systems, topic by topic: Nevada PERS service credit purchase, Nevada PERS working after retirement and Nevada PERS disability retirement.

The seven options

NV PERS’s plan summaries for Regular members say “Prospective retirees may elect one of seven retirement options.” “Benefits are paid to you for life and, after your death, to the one person named as your beneficiary on the retirement application.” The options, in the system’s words and the statute’s:

Option 1: “This option pays you the full monthly allowance you have earned for your lifetime but provides no income protection for your beneficiary after your death.” Option 2 is “a reduced service retirement allowance payable monthly during the retired employees life, with the provision that it continue after the retired employees death for the life of the beneficiary”. Option 3 continues the allowance “at one-half the rate paid to the retired employee”. “These options are calculated the same as options 2 and 3 but are not payable to a beneficiary before the age of 60.” Options 6 and 7: “These options allow you to designate a specific amount to be paid to the beneficiary.” The statute adds a limit: “with the provision that a specific sum per month, which cannot exceed the monthly allowance paid to the retired employee, be paid after the retired employees death to the beneficiary for the life of the beneficiary”. The same sentence of NRS 286.590(6) adds that the payment begins “beginning on the attainment by the surviving beneficiary of age 60 years”, so Option 7 differs from Option 6 on that point. NRS 286.590 also defines an eighth plan, paid for six months to the beneficiary; the two plan summaries read for this page list only seven, so ask NV PERS whether Option 8 is offered to you.

The cost: “The reduction from the Unmodified Allowance is determined by an actuarial percentage based on your age and your beneficiary’s age at the time of retirement.” The statute says an option elected on an early retirement is reduced further: “Any option selected pursuant to this subsection must be reduced by an amount proportionate to the reduction provided in this subsection for the unmodified benefit.”

Spousal consent, deadlines and what is final

NV PERS builds the spouse into the application. Under NRS 286.541 the application is not filed unless it contains, among other things, “A notarized statement of the marital status of the member” and, if the member is married, “a statement of the spouses consent or objection to the chosen retirement plan, signed by the spouse and notarized”. If the spouse has not consented, NRS 286.545 sets a cure period: PERS must “Notify the spouse that the spouse has 90 days to consent or have the member change the members selection” and “Pay the retirement at the amount calculated for Option 2 provided in NRS 286.590 until the spouse consents or for 90 days, whichever is less”. Then “Upon consent of the spouse or at the end of the 90 days, the retirement benefit must be recalculated and paid under the terms of the option originally selected by the member retroactively to the date on which the retirement became effective.”

After retirement the election largely stands. “After retirement, the named beneficiary cannot be changed.” The statute is the source: “A retired employee may not change the selected option or designated beneficiary after the effective date of retirement except as provided in subsection 4 of this section and subsection 3 of NRS 286.525.” Two exits exist. A retiree may go back to the Unmodified Allowance: “A retired employee may cancel the retired employees selected option and designation of beneficiary and revert to the unmodified retirement allowance.” “The written election must be accompanied by a written, notarized acknowledgment of the change by the beneficiary if the beneficiary is the spouse of the retired employee.” And if the beneficiary dies first, “Additionally, if your beneficiary predeceases you, the law provides that your benefit will revert to the Unmodified Option.” “the retired employees monthly retirement allowance must be automatically adjusted to the unmodified retirement allowance provided in NRS 286.551 .”

Timing: “Between three and six months before your retirement date, request an estimate of your retirement benefit and an application for retirement.” Under NRS 286.541(2), retirement becomes effective on the latest of several dates the statute lists, including the day the completed application is filed. For how spousal rights work in other plans, see spousal consent to waive a joint and survivor annuity.

When you can retire, and what early retirement costs

Eligibility depends on the membership effective date. For members before January 1, 2010, a member is eligible to retire “at age 65 if the member has at least 5 years of service, at age 60 if the member has at least 10 years of service and at any age if the member has at least 30 years of service”. From January 1, 2010 through before July 1, 2015, a member is eligible to retire “at age 65 if the member has at least 5 years of service, at age 62 if the member has at least 10 years of service and at any age if the member has at least 30 years of service”. On or after July 1, 2015, a member is eligible to retire “at age 65 if the member has at least 5 years of service, at age 62 if the member has at least 10 years of service, at age 55 if the member has at least 30 years of service and at any age if the member has at least 33 1/3 years of service”.

The reduction formula, from the statute: before 2010 the benefit is reduced “by 4 percent of the unmodified benefit for each full year that the member is under the appropriate retirement age, and an additional 0.33 percent for each additional month that the member is under the appropriate retirement age.” From 2010 on, the benefit is reduced “by 6 percent of the unmodified benefit for each full year that the member is under the appropriate retirement age, and an additional 0.5 percent for each additional month that the member is under the appropriate retirement age.” Two computed examples from assumed inputs, not PERS figures, for a member 2 full years and 3 months under the retirement age. Computed under the pre-2010 rule: 4 x 2 + 0.33 x 3 = 8.99%. Computed under the 2010 and later rule: 6 x 2 + 0.5 x 3 = 13.5%.

How the benefit is figured

The statute sets the multiplier by cohort. For members before January 1, 2010, the benefit is figured “by 2.5 percent for each year of service earned before July 1, 2001, and 2.67 percent for each year of service earned on or after July 1, 2001.” For the middle cohort, the benefit “must be determined by multiplying the members average compensation by 2.5 percent for each year of service earned.” For the newest, the benefit “must be determined by multiplying the members average compensation by 2.25 percent for each year of service earned.” The benefit is capped: a member “is entitled to a benefit of not more than 75 percent of the members average compensation with the members eligibility for service credit ceasing at 33 1/3 years of service.” That 33 1/3-year cap is for a member who is not a police officer or firefighter and joined on or after July 1, 2015. Under NRS 286.551(2), a member whose membership took effect “on or after July 1, 1985, and before July 1, 2015, is entitled to a benefit of not more than 75 percent” has service credit “ceasing at 30 years of service”, and a member who “has an effective date of membership before July 1, 1985, and retires on or after July 1, 1977, is entitled to a benefit of not more than 90 percent” has service credit “ceasing at 36 years of service”. A computed example from an assumed 20 years of service, not a PERS figure: 2.25% x 20 = 45.00% of average compensation, before any option reduction.

Average compensation: “average of your highest 36 consecutive months of employment with provision that each 12 month period of salary may not increase greater than 10% of the prior 12 months of salary reported” In the statute, the 10 percent year-over-year test applies “for an employee who becomes a member of the System on or after January 1, 2010”, and NRS 286.551(5) says “Compensation attributable to a promotion and assignment-related compensation must be excluded” when those limits are calculated. The statute also limits the pay that counts for members who first joined on or after July 1, 2015 (NRS 286.535). Every cohort has a pay limit under NRS 286.535: “For persons who first became members of the System before July 1, 1996, the limitation provided by section 401(a)(17) of the Internal Revenue Code”, as that section existed on July 1, 1993, and “For persons who first became members of the System on or after July 1, 1996, and before July 1, 2015, the limitation provided by section 401(a)(17) of the Internal Revenue Code”, as that section existed on July 1, 1996.

Refunds of contributions

A member can take the money out in some cases. “If you contribute under the employee/ employer contribution plan, you may withdraw your employee contributions if you terminate all employment for which a contribution is required or if you are employed in a position ineligible for membership for at least 90 days.” The effect is final: “A refund cancels all rights to membership including service credit earned under the EPC plan.” The statute says the same: “All membership rights and active service credit in the System, including service for which the public employer paid the employee contributions, are cancelled upon the withdrawal of contributions from a members account.” The refund is of your own after-tax money: “Your after tax contribution is refundable upon the termination of your employment, if you do not elect to receive a monthly retirement benefit.” “These contributions are not deposited to your individual member account and are not available for refund upon termination of employment.”

Process, from NRS 286.430: “The System shall not refund these contributions until it has received:” “A notice of termination from the members public employer or a certification by the public employer that the member is employed in a position for which contribution is prohibited” “Refunds, pursuant to this section, must be made by check mailed to the address specified by a member in the members application for refund.” “A member who transfers to a position for which contribution is prohibited must remain in that position for at least 90 days before the member is eligible to receive a refund pursuant to this section.”

A refund can be repaid: “Repayment, including interest at the actuarially determined rate, may be made in a lump sum or by monthly installments.” “Service will not be restored until your agreement is paid in full.” The statute sets conditions the summary leaves out. NRS 286.440(1) applies when a member “returns to the service of a public employer participating in the System and remains a contributing member for 6 months”, and an installment plan needs approval: “With the approval of the Executive Officer, enter into an agreement containing a schedule of payments to repay the withdrawn contributions plus interest from the date of withdrawal to the date of repayment”. It adds “Payments shall not be less than $10 per month”. If the member does not finish the schedule, NRS 286.440(2) says “the member is entitled to service credit for previous service in the same proportion that the member” bears to the total amount of withdrawn contributions. A retiree can also give up the allowance: “A retired employee who selects an unmodified retirement allowance may relinquish the retired employees right to that allowance and apply for a refund of the retired employees remaining contributions at any time.” “If the designated beneficiary is the spouse of the retired employee, or if the right of the beneficiary is the subject of a court order, the retired employee shall provide an acknowledged release by the beneficiary” A retiree who goes back to work in an eligible position: “The retired employee forfeits all retirement allowances for the duration of that employment.” “The retired employee is entitled to receive, after the termination of the employment and upon written request, a refund of all contributions made by the retired employee during the employment.” The general comparison of a refund and leaving money in is on pension refund versus leaving it in.

What the IRS adds on tax

A refund or lump sum from a public pension is a distribution, so the IRS rules apply on top of NV PERS’s own. On withholding, the IRS says that a taxable eligible rollover distribution paid to you “is subject to mandatory income tax withholding (generally at a rate of 20%), even if you intend to roll it over later”, and that if you roll it over yourself “you’ll have to add funds from other sources equal to the amount withheld”. The NV PERS summaries and statute read for this page do not state how a refund is taxed or rolled over, so the IRS rule is the one to rely on. The rollover clock, if the money is paid to you: “you have 60 days from the date you receive it to roll it over to another eligible retirement plan”.

On early distributions the IRS says “the law imposes a 10% additional tax on certain early distributions from certain retirement plans”. Its list of exceptions includes “Distributions made to you after you separated from service with your employer after attainment of age 55” and “Distributions made to a qualified public safety employee from a governmental plan”. Whether an exception fits a particular refund depends on your own plan and facts, so confirm it with a tax preparer before you take one.

Buying service credit

A member can add service. “any member who has 5 years of creditable service may, except as otherwise provided in subsection 5, purchase up to 5 years of service.” Subsection 5 is a service condition: NRS 286.300(5) says “A person who becomes a member of the System for the first time on or after January 1, 2000, may, on or after July 1, 2001, purchase creditable service” “only if, at the time of the purchase, the person is employed by a participating public employer in a position eligible for membership in the System”. The cost: “You must pay the full actuarial cost associated with your age and average compensation”. The price is not a bargain by default: the older summary says “The cost to purchase one year of service averages about one-third of your annual salary.” The newer rule limits what the purchase buys: “The service purchased is not considered in determining the number of years of service credit for eligibility of a member unless special circumstances of a family medical emergency.” The statutory exclusion is narrower than the plan summary wording. NRS 286.510(1)(c) says service “purchased by a member pursuant to subsection 2 or 3 of NRS 286.300” (and the other purchases it lists) “must not be considered in determining the number of years of service of a member unless the member has a family medical emergency”.

Paying: “Payment may be made in a lump sum or by installment agreement.” “Purchase of service may also be accomplished using certain types of retirement savings accounts such as 401(a), 401(k) qualified pension trusts, 403(b) and 457 retirement savings plans and IRAs.” If an installment agreement fails, “the member is entitled to receive service credit in the proportion that the principal paid bears to the principal due under the agreement.” Military purchase under NRS 286.300(3) covers a member with 5 years of creditable service who served on active duty from Operation Desert Storm on and was honorably discharged: months equal to the full months served, but “in no case may the service purchased pursuant to this subsection exceed 3 years”. Earlier service with the present employer, from before it enrolled in the system, can also be bought (NRS 286.300(1)): “The member must pay the full actuarial cost as determined by the actuary.” To test whether a purchase pays for itself, see the pension buyback calculator.

Vesting, COLAs and survivors

Vesting: “If you are a contributing member of PERS after June 30, 1989, you earn the right to receive a retirement allowance after five years of service.” Cost-of-living increases depend on the cohort. Members with a membership effective date on or after July 1, 2015: “By 2 percent following the 3rd, 4th and 5th anniversaries of the commencement of benefits.” “By 2.5 percent following the 6th, 7th and 8th anniversaries of the commencement of benefits.” “By the lesser of 3 percent or the increase, if any, in the Consumer Price Index (All Items) published by the United States Department of Labor for the preceding calendar year”. For January 1, 2010 to before July 1, 2015: “3 percent following the 6th anniversary of the commencement of benefits, 3.5 percent following the 9th anniversary of the commencement of benefits, 4 percent following the 12th anniversary of the commencement of benefits and each year thereafter”; or “The average percentage of increase in the Consumer Price Index (All Items) for the 3 preceding years, unless a different index is substituted by the Board.”

A survivor of a retiree who chose Option 2, 3, 4 or 5 receives increases on a defined base: “The base benefit for the retired employee if the retired employee selected option 2 or 4”; or “Fifty percent of the base benefit of the retired employee if the retired employee selected option 3 or 5.” Pre-retirement survivor benefits require “You had two years of service in the two and one-half years immediately preceding your death”; or “You had more than 10 years of accredited service”; or “Your death was caused by an occupational disease or an accident arising out of or in the course of your employment, regardless of service credit”. The statute says “if the employee had 10 or more years of accredited contributing service” (NRS 286.672(1)), so exactly 10 years qualifies, not only more than 10.

What this page could not settle

• NV PERS has no lump sum at retirement in the sources read; the only lump sums are refunds and service purchases.
• How a refund is taxed, rolled over or withheld on is not stated in the plan summaries or the statute read; the IRS section above is the general rule.
• The interest credited on a refund, and the current member contribution rate, are not stated; the summaries point to www.nvpers.org.
• Police and fire members have their own multipliers and ages, which this page does not cover.
• A deadline for electing among Options 1 to 7 is not stated beyond filing the application, and the three to six month window to request an estimate.
• The COLA schedule for members with a membership effective date before January 1, 2010 is in NRS 286.5756, which keys on the date benefits began rather than the membership date: “Except as otherwise provided in NRS 286.571 and 286.574, a person is entitled to the increase provided in this section if the person began receiving an allowance or benefit”, with “Two percent following the 3rd anniversary of the commencement of benefits, 3 percent following the 6th anniversary of the commencement of benefits, 3.5 percent following the 9th anniversary of the commencement of benefits, 4 percent following the 12th anniversary of the commencement of benefits and 5 percent following the 14th anniversary of the commencement of benefits”, and Option 8 appears in the statute but not in the plan summaries.

Common mistakes

• Choosing Option 1 for the largest allowance with a spouse who would have no income after your death.
• Applying for an option without the spouse’s notarized consent or objection, which delays the application and triggers the 90-day Option 2 payment rule.
• Applying the wrong cohort’s eligibility age or reduction, which depends on the membership effective date.
• Taking a refund and forgetting it cancels all membership rights and service credit.
• Assuming purchased service counts toward the years needed to retire; for members enrolled on or after July 1, 2015 it generally does not.

Related on this site: Nevada retirement taxes, whether Nevada taxes pensions, single life versus joint and survivor and public pension retirement decisions by system.

Sources

• Nevada PERS, Summary Plan Description for Regular Members, enrolled on or after July 1, 2015: https://www.nvpers.org/sites/default/files/2019-10/regPlan-EnrolAfter-7-1-2015.pdf
• Nevada PERS, Summary Plan Description for Regular Members (2009 law): https://www.nvpers.org/public/publications/regPlan.pdf
• Nevada Revised Statutes, chapter 286, Public Employees’ Retirement System (Nevada Legislature): https://www.leg.state.nv.us/nrs/nrs-286.html
• IRS, Topic no. 413, Rollovers from retirement plans (irs.gov): https://www.irs.gov/taxtopics/tc413
• IRS, Topic no. 558, Additional tax on early distributions from retirement plans other than IRAs (irs.gov): https://www.irs.gov/taxtopics/tc558

Sources: the primary documents linked above, read on October 2, 2026. General information from each system’s own published materials, not legal, tax or financial advice. Your own member statement and the system’s current rules decide your benefit, and a pension counsellor at the system or a fee-only adviser is the right place to confirm anything consequential.