Updated October 8, 2026. Quick answer: The Connecticut Municipal Employees’ Retirement System (CMERS) pays a monthly benefit built on 2% of final average pay for each year of service, with a lower rate on pay up to a breakpoint after 62 for members covered by Social Security. A retiring member picks one of four payment options, locked once the first check is cashed. A member with fewer than 5 years of continuous service and fewer than 15 of aggregate service who leaves may withdraw contributions with 5% interest, and 20% is withheld unless rolled over. A DROP of up to 60 months starts July 1, 2025.
What this page covers and what it does not
This page works from Connecticut Office of the State Comptroller documents: the CMERS Summary Plan Description (“Revised as of July 1, 2023”), two FAQ pages, a June 2023 memorandum and the DROP summary, read on October 8, 2026. Computed examples are labeled.
The Summary Plan Description states: “CMERS is a defined benefit plan”. A member is generally “a regular, full-time employee of a Participating Municipality” in a department designated for coverage. The page covers members in general, with police and firefighter variations where noted. The documents read use no Plan A, Plan B, Plan C or Hybrid labels, so none of those groups is described. State tax questions are on does Connecticut tax pensions, and the state employee system is on Connecticut SERS retirement decisions.
When a pension can start
A Normal Retirement requires any one of three things, which the plan lists as “Complete twenty-five or more years of Aggregate Service”; “Reach the age of fifty-five and complete five or more years of Continuous Service”; or “Reach the age of fifty-five and complete fifteen or more years of Aggregate Service”.
Leaving sooner gives two paths. An Early Retirement is for a member who “completes five or more years of Continuous Service, but fewer than 25 years of Aggregate Service” and who “elects to begin receiving retirement benefits before reaching the age of fifty-five”. The benefit is “reduced by an amount that the Commission determines to be the actuarial cost associated with your early retirement”, and the plan says “the reduction to your Normal Retirement benefit is permanent”. A Vested Rights Retirement defers the start: “You have a vested right to retirement benefits if you have completed at least five years of Continuous Service or fifteen years of Aggregate Service.” Such a member who is under 55 is told “you may elect to defer your retirement benefits until you reach age 55”.
How the monthly benefit is figured
Final average pay is “the average of the Pay you received for each of your three highest-paid years of service”. The plan uses “the Breakpoint for the calendar year during which you separate from municipal service for the last time”, and “The Year’s Breakpoint increases by six percent each year, rounded to the nearest multiple of one hundred dollars”. Without Social Security coverage the formula is “Two Percent (.02) X Final Average Pay X Years of Aggregate Service”. With coverage, the same 2% formula applies “until you reach age 62”, and from 62 it becomes “One and a Half Percent (.015) X Final Average Pay Up to Your Breakpoint X Years of Aggregate Service”, plus “Two Percent (.02) X Final Average Pay Above Your Breakpoint X Years of Aggregate Service”. “To determine your monthly benefit, divide the result of this formula by 12.”
A computed example from assumed inputs, not CMERS figures: an assumed final average pay of $100,000, an assumed 20 years of aggregate service, and $95,177 as the breakpoint (the 2023 figure in the plan’s example; the right year depends on separation). Before 62: 2% of $100,000 times 20 years, a computed $40,000 a year or $3,333 a month. After 62: 1.5% of $95,177 times 20 years, a computed $28,553, plus 2% of the $4,823 above the breakpoint times 20 years, a computed $1,929, for a computed $30,482 a year or $2,540 a month. On these inputs the benefit after 62 is lower.
The Comptroller’s FAQ puts it this way: “the formula reduces the benefit by approximately 25% (e.g. a benefit of $1,357.17 per month would be reduced to $1,031.33)”.
Deferring retirement: the higher multipliers
The plan adds an incentive for members employed on or after July 1, 2025. “Ordinarily, the multiplier is either 1.5% or 2%, depending on whether you are eligible for Social Security benefits.” Each additional year past a threshold is “calculated with a larger multiplier: either 1.7% or 2.2%”. The Summary Plan Description sets the thresholds as “You are 60 years old, with at least 30 years of Aggregate Service”, or “You are 55 years old, with at least 27 years of Active Service in a paid municipal police department or fire department”. The June 2023 memorandum gives the police and firefighter version as “Age 57, with 27 years of active service as a paid police officer or firefighter”; CMERS should confirm which applies.
The election: four payment options and one permanent choice
At retirement a member picks one of four payment options. “If you select an option that pays benefits after you die, then the benefit you receive during your retirement will be smaller than it would be if you made no provision for a Contingent Annuitant.”
| Option | What the member receives | What a survivor receives |
|---|---|---|
| Option A, 50% Spouse | A reduced monthly benefit for life | If the spouse is alive at death, 50% of the reduced benefit continues for the spouse’s life |
| Option B, 50% or 100% Survivor | A reduced monthly benefit for life | 50% or 100% of the reduced benefit (as chosen) continues for the life of one named Contingent Annuitant |
| Option C, 10-Year or 20-Year Period Certain | A reduced monthly benefit for life | Payments guaranteed for 10 years (120 payments) or 20 years (240 payments); the rest go to the Contingent Annuitant(s) or the estate |
| Option D, Straight Life Annuity | The highest monthly benefit for life | Nothing; all payments stop at death |
The documents read do not state the size of the reductions. Under Option B, “If you choose the 100% Contingent Annuitant option, if your Contingent Annuitant is not your spouse, and if your Contingent Annuitant is ten or more years younger than you are, then federal law requires an additional reduction to the Contingent Annuitant’s income”.
A computed example from an assumed $2,000 reduced monthly benefit, not a CMERS figure: Option A leaves a spouse 50% of $2,000, a computed $1,000 a month; Option B at 100% leaves a computed $2,000; Option C with the 10-year guarantee totals 120 payments of $2,000, a computed $240,000. The $2,000 is invented because the reduction is not published. See also single-life versus joint-and-survivor pension.
Spouse consent and the default option
For a member married at least a year, an option that gives the spouse no lifetime benefit means that “you must obtain a notarized form of your spouse’s written consent to your choice, and you must submit it at the time of your retirement”. The form is titled “Spouse Waiver of Monthly Survivor Benefits”. See spousal consent to waive a joint-and-survivor annuity. If no option is chosen, “your benefit will be paid under Option A” for a member married at least a year, and otherwise “your benefit will be paid under Option D”.
What is irrevocable, and the deadlines
“Your choice of benefit payment option may not be changed after you retire.” The retiree FAQ describes a narrow window before that point: “You can change your payment option, annuitant or beneficiary for a monthly survivor benefit or payment option at any time prior to cashing your first retirement check but no later than the 25th of the month following the month your first check is mailed”.
Applications run through the employer, with notice of “generally, 90 days before your intended date of retirement” before the retirement date. “If the CMERS Unit receives your application after your intended date of retirement, your retirement will be deemed to be effective on the date the application is received.” A 90-day rule applies if a member who has chosen to “select Option B (50% or 100% Survivor) or Option C (10-Year or 20-Year Period Certain)” dies before payments begin: the plan says that if the death comes “within 90 days after you first elect one of these options, then the person you named as your Contingent Annuitant will receive the same retirement payments that would have been paid if you had retired on the day of your death”.
Survivor benefits
After retirement, if the payments made fall short of the member’s contributions, “the excess amount of your contributions and interest will be paid in a lump sum to your Beneficiary”. “Unlike your choice of a Contingent Annuitant, your choice of a Beneficiary may be changed at any time you wish.”
The deferred retirement option program (DROP)
The DROP summary effective July 1, 2025 describes a program that “allows members of the Connecticut Municipal Employees’ Retirement System (CMERS) who are eligible to retire to elect to defer their retirement allowance while continuing their employment for up to 60 months”. “The member’s retirement allowance is credited to their own separate DROP account instead of being paid to them directly.”
For general employees eligibility starts at “the age of 62 with five years of continuous service” or “the age of 60 with 30 years of aggregate service”. For police officers and firefighters it is “the age of 57 with five years of continuous service”, “the age of 55 with 25 years of aggregate service”, or “with 30 years of aggregate service regardless of age”.
The election is binding. “The member’s election to participate in the DROP is irrevocable and requires an agreement to resign from permanent employment at the end of the DROP period” The account is credited with the allowance, a share of the member’s contributions (“An amount equal to 50% of the member’s contribution is credited to the member’s DROP account each payroll period for 24 months from the DROP effective date or until the member terminates employment, if earlier. For members who remain in the DROP for more than 24 months, 100% of their required contributions will be contributed to their DROP account until they terminate employment and exit the DROP”) and interest, which is “capped at 4% and with a floor of 0%”.
A computed example from an assumed $3,000 monthly allowance, not a CMERS figure: credited for the full 60 months it adds 60 times $3,000, a computed $180,000, before interest and contribution credits.
“A member cannot access their DROP account funds until they terminate their permanent employment with the participating municipality.” After that, the summary says “the member can receive their DROP account balance as a lump sum, a rollover, or a combination of both”.
Leaving before retirement: refund, leave it, or defer
A vested member may take a Vested Rights Retirement at 55 or an Early Retirement at a permanent reduction. The refund is for someone who is not vested: “If you leave municipal employment without having completed either five years of Continuous Service or fifteen years of Aggregate Service, you may withdraw the Employee Contributions you made to CMERS during your active employment”. On whether to withdraw, the FAQ says “If you are reasonably sure that it is unlikely you will ever accumulate five years of service credit, you may be better served by withdrawing your contributions”. See pension refund versus leaving it.
Taking a refund: what is paid and what ends
Interest is added: “you will also receive a payment of interest at 5% a year”. “Upon termination of employment, an employee may only apply for a full refund or rollover of his/her contributions and interest.” “If you do not ask to withdraw your Employee Contributions within 10 years of the termination of your municipal employment, your contributions and interest will revert to the Municipal Employees Retirement Fund.”
A refund gives up the pension: “you waive all claims and entitlements for all retirement and pension related benefits for the period of membership for which the withdrawal is made”. The employer’s share stays behind, since “Employer contributions remain in the Retirement System”. The plan says that for a member who withdrew and later returns to a participating municipality, “then you will not receive credit for your prior service, unless you repay your withdrawn contributions and interest, with additional interest at a rate to be determined by the Commission”.
Rollovers and the 20% withholding
The FAQ says the IRS requires CMERS to “withhold 20% from your refund if you do not roll over the funds to a qualified retirement plan or IRA”. “Such rollovers must be approved in advance by CMERS.” See 20% withholding on a pension lump sum. A computed example from an assumed $10,000 taxable refund paid to the member, not a CMERS figure: 20% of $10,000 is a computed $2,000 withheld, leaving a computed $8,000 in cash.
Buying service credit
A purchase starts with a written request, and the plan says “will not obligate you to pay the invoice”. It adds that “you will receive no Aggregate Credit until all of the required contributions have been paid”. For prior military service the payment due is “Two percent of the employee’s first-year salary as a member of CMERS for the period of military service, plus five percent interest”. For example, 2% of an assumed $50,000 first-year salary is a computed $1,000, before the 5% interest, and not a CMERS figure. See the pension buyback calculator.
Cost-of-living adjustments
For a Normal, Early or Vested Rights retiree who retires on or before June 30, 2025, “Each COLA will fall within a range between a minimum of 2.5% and a maximum of 6%”. For a Normal, Early or Vested Rights retiree who retires between July 1, 2026 and June 30, 2027, the plan says “If the CPI-W increases by 2% or less, then the amount of the COLA will equal the greater of either (i) 1.5% or (ii) the amount of the increase to the CPI-W”, and when the CPI-W rises more, “each COLA will fall within a range between 2% and 7.5%”.
The formula inside the range is “60% of the increase in the CPI-W up to 6% PLUS 75% of the increase in the CPI-W above 6%”. “You will receive your first COLA on the first July 1 that falls after you have been retired for at least 12 months.”
A computed example from assumed figures, not CMERS figures: if the CPI-W rose an assumed 5%, 60% of 5% is a computed 3.0%, inside the 2% to 7.5% range, so an assumed $3,000 monthly benefit rises by a computed $90 to $3,090.
Tax on the pension itself
On the monthly pension, the FAQ says “if no CT-W4P has been received by CMERS we will automatically withhold 6.99% for Connecticut state income tax if you live in the state of Connecticut”. The state side is on Connecticut retirement taxes.
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 CMERS’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 Comptroller’s FAQ describes refunds and rollovers on the same basis, including the 20% federal withholding. 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” if the employee separated from service during or after the year they attained age 50 or 25 years of service under the plan, whichever is earlier. 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.
What this page could not settle
- The documents read do not describe Plan A, Plan B, Plan C or Hybrid tiers.
- The documents read do not state how much Options A, B or C reduce the monthly benefit, or the early retirement reduction as a percentage; the Summary Plan Description says the Commission determines the actuarial cost.
- The police and firefighter threshold for the higher multiplier differs between the Summary Plan Description (age 55) and the June 2023 memorandum (age 57); the Summary Plan Description was followed.
- The retiree FAQ still says “The COLA for non-disability retirements will range from a minimum 2.5% to a maximum of 6%”, while the Summary Plan Description gives phased minimums; the latter was followed.
- The Summary Plan Description, revised as of July 1, 2023, says “The Retirement Commission is in the process of creating a DROP for CMERS members”; the DROP summary was used for the program’s terms.
- The breakpoint for the current year, the DROP administrative code rules, the individual forms, the statute text and the Comptroller’s calculators were not read.
Common mistakes
- Treating the payment option as changeable after the first check is cashed.
- Choosing an option that leaves the spouse without a lifetime benefit and no notarized consent form.
- Withdrawing contributions without weighing what ends; the member waives all claims for that period of membership.
- Entering the DROP without noting the election is irrevocable and requires an agreement to resign at its end.
Related on this site: public pension retirement decisions by system, Connecticut retirement taxes, does Connecticut tax pensions, Connecticut SERS retirement decisions, Connecticut TRB retirement decisions and pension refund versus leaving it.
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Answer againSources
- Connecticut Office of the State Comptroller, Retirement Services Division, Connecticut Municipal Employees Retirement System Summary Plan Description (revised as of July 1, 2023): https://osc.ct.gov/wp-content/uploads/2023/10/CMERS-Summary-Plan-Description-2023-09-12.pdf
- Connecticut Office of the State Comptroller, Retirement Services Division, CMERS Retiree Frequently Asked Questions (web page, read October 8, 2026): https://osc.ct.gov/retirement/mers/retiree-faq/
- Connecticut Office of the State Comptroller, Retirement Services Division, CMERS Member Frequently Asked Questions (web page, read October 8, 2026): https://osc.ct.gov/retirement/mers/member-faq/
- Connecticut Office of the State Comptroller, Retirement Services Division, Memorandum to All Municipalities Participating in MERS, CMERS Amendments (June 26, 2023): https://osc.ct.gov/wp-content/uploads/2024/08/OSC-Memorandum-MERS-Reforms-6-26-23.pdf
- State of Connecticut, Connecticut Municipal Employees’ Retirement System, Deferred Retirement Option Program (DROP) Summary (effective July 1, 2025): https://osc.ct.gov/wp-content/uploads/2024/11/State-of-Connecticut-DROP-Summary-Plan-Description-8.29.24-cp.pdf
- 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 8, 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.