Missouri MPERS Retirement: Options, Refund, COLA, Vesting

Updated October 16, 2026. Quick answer: MPERS (the MoDOT and Highway Patrol system) pays a base benefit of 1.7% of final average pay per year of service in the Year 2000 Plan and 2011 Tier, and 1.6% in the Closed Plan. At retirement a member picks a life annuity, a joint and 50% or 100% survivor option, or guaranteed payments, and the brochure calls the election irrevocable once the first payment is issued. Year 2000 Plan and Closed Plan members can take a BackDROP lump sum of 90% of the back payments, with 20% withheld on cash. 2011 Tier members who leave can request a refund of contributions, which forfeits their rights, unless they are eligible for normal retirement, on disability or have a division of benefits order on file. Vesting takes five years.

What this page covers and which group each statement applies to

MPERS runs three plans whose rules differ, so each statement names its group. The Closed Plan covers people “hired or receiving disability benefits prior to July 1, 2000” and who “became vested prior to leaving state employment”. The Year 2000 Plan covers those “Hired for the first time on or after July 1, 2000, but prior to January 1, 2011”, and the 2011 Tier those “hired for the first time on or after January 1, 2011”. A Closed Plan member also chooses a plan at retirement: “At retirement, members of the Closed Plan may elect to remain in the Closed Plan or switch to the Year 2000 Plan”.

Three documents are read: the Year 2000 Plan and 2011 Tier Retirement Handbook (“Revised February 2021”), the Closed Plan Retirement Handbook (also revised February 2021), and the brochure Understanding Your Retirement Decisions (December 2022). Each handbook says “the laws and policies will prevail” over its text.

Eligibility, vesting and how the pension is figured

The Handbook gives the base benefit as “Service x 1.7% x Final Average Pay = Base Benefit” for the Year 2000 Plan and 2011 Tier, and the Closed Plan Handbook gives “Service x 1.6% x final average pay (FAP)”. Final average pay is “the average of your highest 36 consecutive months of pay, including overtime”. For the Year 2000 Plan and 2011 Tier, the statute’s definition of pay in RSMo 104.1003(21) excludes the following: “b. Any amounts paid upon termination of employment for unused annual leave or unused sick leave; c. Pay in excess of the limitations set forth in Section 401(a)(17) of the Internal Revenue Code of 1986, as amended and other applicable federal laws or regulations; d. Any nonrecurring single sum payments; and e. Any amounts for which contributions have not been made in accordance with section 104.1066;” To qualify for a benefit a member needs “at least five years of vesting service”. Two Year 2000 Plan rules in RSMo 104.1024 are not in that sentence. Subsection 3 says “The life annuity defined in subsection 2 of this section shall not be less than a monthly amount equal to fifteen dollars multiplied by the member’s full years of credited service.” Subsection 5 says “The annuity described in subsection 2 of this section for any person who has credited service not covered by the federal Social Security Act, as provided in subdivision (1) of subsection 7 of section 104.342, shall be calculated as follows: the life annuity shall be an amount equal to two and five-tenths percent of the final average pay of the member multiplied by the number of years of service not covered by the federal Social Security Act in addition to one and seven-tenths percent of the final average pay of the member multiplied by the member’s years of credited service covered by the federal Social Security Act.”

One trap: “Vested members of the Year 2000 Plan and 2011 Tier who leave state employment prior to retirement, cannot qualify for Rule of 80 or Rule of 90 eligibility”, and a member who qualifies “must apply for retirement within 65 days of leaving state employment or risk not receiving benefits until much later”. Early retirement is priced this way: “your base benefit will be reduced .5 percent (.005) for each month you retire earlier than the date you are eligible for normal (full) retirement”. Year 2000 Plan and 2011 Tier members who retire under Rule of 80 or Rule of 90 (uniformed Patrol members qualify at the ages the Handbook lists; the Closed Plan has no temporary benefit) also receive a temporary benefit that “will be equal to .8 percent (0.008) of your final average pay multiplied by your years of creditable service”. “At age 62, the temporary benefit and any COLAs earned on that amount go away”. RSMo 104.1024(4) states the end point: “The temporary annuity and any cost-of-living adjustments attributable to the temporary annuity pursuant to section 104.1045 shall terminate at the end of the calendar month in which the earlier of the following events occurs: the member’s death or the member’s attainment of the earliest age of eligibility for reduced Social Security retirement benefits, but no later than age sixty-two.”

A computed example from an assumed $3,000 final average pay and an assumed 25 years, not an MPERS figure: 1.7% of $3,000 for 25 years is a base benefit of $1,275.00 a month (Year 2000 Plan or 2011 Tier), or $1,200.00 (computed) at the Closed Plan’s 1.6% for a MoDOT or civilian Patrol member (a uniformed Patrol member multiplies that result by 1.333333). The temporary benefit, 0.8% of $3,000 for 25 years, adds $600.00 until 62. Early retirement 48 months before 62, with 20 years: base $1,020.00, reduction 48 x .5%, or 24%, leaving 76%, or $775.20 a month.

Choosing a payment option: what each pays and what it does to a survivor

The Year 2000 Plan and 2011 Tier offer a life income annuity, a reduced joint & 50% survivor option, a reduced joint & 100% survivor option and life income with guaranteed payments. The Closed Plan Handbook lists four options too, but its guaranteed-payment choices are 60 or 120 payments (not 120 or 180), and its joint & 50% survivor option is “unreduced”. The election “determines whether or not a benefit will potentially be paid to anyone after your death”, though “you will receive a benefit payment every month for your lifetime” under any option.

The life income annuity is not reduced and pays no one afterward, and “If you are married at retirement, your spouse must consent to this option”. Any married member who skips a joint and survivor option needs the same signature; see single-life versus joint-and-survivor pension and spousal consent to waive a joint-and-survivor annuity. Under joint and 50%, “Your eligible spouse’s benefit will be 50 percent of the benefit amount you are receiving at the time of your death excluding any temporary benefit and COLAs earned on that amount”; joint and 100% pays the spouse 100 percent of that amount. The survivor is the spouse named at retirement, “regardless of your marital status at the time of your death”. For the Year 2000 Plan and 2011 Tier, RSMo 104.1027(4) says that a dissolution of marriage does not by itself end the former spouse’s survivor benefit: “such dissolution shall not affect the option election pursuant to this section and the former spouse shall continue to be eligible to receive survivor benefits upon the death of the member, except a member may cancel his or her election if:” Under subdivision (1), the member may cancel if “The dissolution of marriage of the member and former spouse occurred on or after January 1, 2021, and the dissolution decree provides for sole retention by the member of all rights in the annuity and provides that the former spouse shall not be entitled to any survivor benefits pursuant to this chapter; or” Under subdivision (2), a dissolution before January 1, 2021 needs an amended or modified decree obtained after January 1, 2021, as set out in paragraphs (a) and (b) of that subdivision. Under guaranteed payments, the beneficiary receives what remains of the window.

The Handbook applies the factors “only to the base life annuity amount”, so the temporary benefit is not reduced. A computed example from an assumed $3,000 final average pay, an assumed 25 years, a Year 2000 Plan retirement at 62 and an assumed spouse 5 years younger, not an MPERS figure. The life income annuity is $1,275.00. Joint & 50%: 88.5% (90% less .3% for each of 5 years) is $1,128.38 (computed) a month, and the spouse then receives $564.19 (computed). Joint & 100%: 80.5% (83% less .5% for each of 5 years) is $1,026.38 (computed) a month, $248.63 (computed) less than the life annuity, and the spouse then receives that same $1,026.38. With 120 guaranteed payments (95%) the retiree receives $1,211.25 (computed), and with 180 (90%) $1,147.50 (computed).

When the election locks, and the filing deadlines

Applying takes two steps, and “the notice and election form must be received at MPERS by the dates listed in the chart below”. Sample rows of the chart:

The brochure states the lock: “Once your first retirement benefit payment has been issued, your benefit payment option cannot be changed; however, there are a few exceptions related to marriage, death, and divorce”. The exceptions are narrow: “You will have one year from your date of marriage to submit a New Spouse Designation form” for a new spouse; a survivor option can revert to the life annuity when a spouse dies, but the Handbook says “The pop-up is not automatic”. For the Year 2000 Plan and 2011 Tier, RSMo 104.1027(3) says “If a member has elected at the annuity starting date option 1 or 2 pursuant to this section and if the member’s spouse or eligible former spouse dies after the annuity starting date but before the member dies, then the member may cancel the member’s election and return to the life annuity form of payment and annuity amount, effective the first of the month following the date of such spouse’s or eligible former spouse’s death. If a member dies prior to notifying the system of the spouse’s death, the benefit will not revert to a life annuity and no retroactive payments shall be made.” Service to be bought must be finished first: “All prior service that you plan to purchase or transfer must be completed before submitting your Notice of Retirement”. For Closed Plan members, RSMo 104.103(7) says “For members who retire on or after July 1, 2000, in the event such member has chosen a joint and survivor option under the provisions of section 104.090 and the member’s eligible spouse or former spouse precedes the member in death, the member’s benefit shall revert, effective the first of the month following the death of the spouse or former spouse regardless of when the board receives the member’s written application for the benefit provided in this subsection, to an amount equal to the member’s normal annuity, as adjusted for early retirement if applicable; such benefit shall include any increases the member would have received since the date of retirement had the member elected a normal annuity.” Subsection 8 of that section applies to a retired member whose spouse has died and conditions the reversion on an application to the board.

BackDROP: the lump sum, the rollover and the cost

The BackDROP is for members who worked past full retirement eligibility. “BackDROP is a payment option Year 2000 Plan members may be eligible to elect upon retirement” (the Closed Plan Handbook describes the same option), and it is “not available for 2011 Tier members”. The monthly benefit is set as if retirement happened earlier, and “you will receive a lump sum payment equal to 90 percent of the life income annuity amount you would have received during the BackDROP period”. A member must have been actively employed in a benefit-eligible position at full retirement eligibility and “at least two years beyond your normal (full) retirement eligibility date”. It is optional: “You are not required to elect the BackDROP regardless of how long you work beyond normal (full) retirement eligibility”. The statute, RSMo 104.1024(6), opens “Effective July 1, 2002, any member, except an elected official or a member of the general assembly, who has not been paid retirement benefits and continues employment for at least two years beyond the date of normal retirement eligibility, may elect to receive an annuity and lump sum payment or payments, determined as follows:” It then limits the start date: “In addition, the retroactive starting date shall not be more than five years prior to the annuity starting date. The member’s selection of a retroactive starting date shall be done in twelve-month increments, except this restriction shall not apply when the member selects the total available time between the retroactive starting date and the annuity starting date;”

The lump sum is paid in cash, as a rollover or both. On cash, “MPERS is required to withhold 20 percent of the payment for IRS purposes and report it as federal income tax withholding”; on a rollover, “your payment must be made directly to a qualified plan. No income tax will be withheld”. See 20% withholding on a pension lump sum.

A computed example from an assumed $1,500 monthly life annuity and an assumed 36-month BackDROP period, not an MPERS figure, ignoring the cost-of-living adjustments the real calculation includes: 36 x $1,500 is $54,000, 90% of that is a $48,600 lump sum, and 20% withholding on cash is $9,720, leaving $38,880 before any further tax.

The Handbook’s own illustration (retiring at 53, BackDROP date at 50, illustrative only) shows the cost in monthly income: a lump sum of “$57,015.25”, but a monthly benefit of “$1,794.69” against “$2,062.50” without the BackDROP, a difference of $267.81 a month. See pension lump sum versus monthly annuity break-even.

Leaving before retirement: vesting, forfeiture and the 2011 Tier refund

Leaving the Year 2000 Plan before vesting forfeits service: “you forfeit your accrued service credit and all rights to benefits in MPERS’ Year 2000 Plan”, restored after one continuous year of membership on return. After vesting, “you will be entitled to a deferred annuity once you meet the age and service requirements for retirement”.

A refund exists only where contributions exist, and even in the 2011 Tier the Handbook says members eligible for normal retirement, members on disability and members with a division of benefits order on file are not eligible for one. The 2011 Tier is contributory (“a four percent contribution is deducted from your pay”), while the Closed Plan Handbook says “the cost of your retirement plan has been funded solely by employer contributions” and the Year 2000 Plan is non-contributory, so the pages read describe no refund for those two groups. For the 2011 Tier, “If you request a refund of your employee contributions, you will forfeit all rights to benefits for that period of service”. Payment comes “after 90 days from the date you leave state employment or MPERS receives your refund request, whichever is later”. A married member needs a signature: “your spouse must consent to your election by signing the Request for Refund of Employee Contributions form”. In the 2011 Tier, a member who leaves before vesting “will stop earning annual interest on your employee contribution account”. Restoring service later is costly: “The cost to restore service after a refund can be very expensive”. RSMo 104.1091 subsection 8(6)(e) states the condition: “If such member subsequently becomes an employee and works continuously for at least one year, the credited service previously forfeited shall be restored if the member returns to the system the amount previously refunded plus interest at a rate established by the board;” A small account is handled differently. Under subsection 8(6)(b), “For a former member who is not vested, the system shall refund the former member’s contributions and interest credited thereon if the total amount thereof is one thousand dollars or less, or such other amount as may be permitted under applicable federal law.”

A computed example from an assumed $50,000 salary for an assumed 5 years, not an MPERS figure and before interest: 4% of $50,000 is $2,000 a year, so contributions are $10,000 (computed). If a taxable refund of that size were paid to the member as an eligible rollover distribution, 20% withholding would be $2,000, leaving $8,000 (computed) in cash before any further tax. See pension refund versus leaving it.

Buying or transferring service credit

Prior service can raise the benefit, but the Handbook says that, generally speaking, “you have up to two years to pay for purchased service” and “Waiting to purchase the service will increase the cost of the service”. Military service differs by group: a Year 2000 Plan member must first be vested (five or more years of creditable service) and then may purchase up to four years of creditable prior service for active duty time served before joining MPERS, but “Members of the 2011 Tier may not purchase military service”. RSMo 104.1021(6) also requires that the member not be receiving, or be eligible to receive, retirement credits or benefits for that military service from any other public or private retirement plan, other than a United States military service retirement system. It sets the payment term this way: “The payment shall be made over a period of not longer than two years, measured from the date of election, and with simple interest on the unpaid balance.” Unused sick leave is also credited. RSMo 104.1021(2) says “The member shall receive one-twelfth of a year of credited service for each one hundred and sixty-eight hours of such unused sick leave.” and “Such credited service shall not be used in determining the member’s eligibility for retirement or final average pay.” For members covered by subsection 12 of 104.1091, subsection 12(8) says “The unused sick leave credit granted under subsection 2 of section 104.1021 shall not apply to members covered by this subsection unless the member terminates employment after reaching normal retirement eligibility or becoming eligible for an early retirement annuity under this subsection;” See the pension buyback calculator.

Cost-of-living adjustments

The rule: “The annual COLA rate will be equal to 80 percent of the percentage increase in the Consumer Price Index for All Urban Consumers for the United States (CPI-U), with an annual maximum of 5 percent”. Timing differs: Closed Plan members receive their COLA every October, and Year 2000 Plan and 2011 Tier members receive it on the anniversary of their retirement date or BackDROP date. A 2011 Tier member who retires from vested former member status receives the first COLA on the second anniversary of retirement. The brochure adds for the Closed Plan: “Eligible Closed Plan retirees who were hired before August 28, 1997, will receive a minimum four percent annual COLA until the accumulated COLAs reach 65% of the base benefit”. The statute, RSMo 104.103(1), words it this way: “Any such annual benefit increase, however, shall not exceed five percent, nor be less than four percent, and the total increase in the amount of benefits received pursuant to the provisions of this section shall not exceed sixty-five percent of the initial monthly benefit which the member received upon retirement or the benefit received immediately prior to October 1, 1986, whichever is later.” Subsection 2 covers members first employed on or after August 28, 1997: an annual increase of 80 percent of the consumer price index increase, capped at five percent. Subsection 3 covers members employed before August 28, 1997 who terminate employment or retire after that date: “For such members, the annual benefit increase described in subsection 2 of this section shall not be effective until the year in which the member reaches the limit on total annual benefit increases provided by subsection 1 of this section. After that year, the member shall receive the annual benefit increase described in subsection 2 of this section.”

Death before retirement and the $5,000 death benefit

For a vested Year 2000 Plan member who dies before retiring, “the spouse to whom you are married on your date of death is eligible to receive survivor benefits”. RSMo 104.1030(1) sets who is covered: “If a member with five or more years of credited service or a vested former member dies before such member’s or such vested former member’s annuity starting date, the applicable annuity provided in this section shall be paid.” Subsection 2 sets the amount: “The member’s surviving spouse who was married to the member at the date of death shall receive an annuity computed as if such member had: (1) Retired on the date of death with a normal retirement annuity based upon credited service and final average pay to the date of death, and without reduction if the member’s age was younger than normal retirement eligibility; (2) Elected option 2 provided for in section 104.1027; and (3) Designated such spouse as beneficiary under such option.” The brochure says: “MPERS provides a cost-free $5,000 death benefit for the designated beneficiary(ies) of active members and disability recipients who retire after September 28, 1985”, and “Vested members who left state employment prior to retirement are not eligible for this benefit”. For the Closed Plan, RSMo 104.140(1) says “If a member who has five or more years of creditable service dies before retirement, the member’s surviving spouse, to whom the member was married on the date of the member’s death, if any, shall receive the reduced survivorship benefits provided in option 1 of subsection 3 of section 104.090 calculated as if the member were of normal retirement age and had retired as of the date of the member’s death and had elected option 1.” The 65 days in the Handbook appear in the statute only in the life insurance provision, RSMo 104.1072(1)(2): “Any member who terminates employment after reaching normal or early retirement eligibility and becomes a retiree within sixty-five days of such termination shall receive five thousand dollars of life insurance coverage.”

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 MPERS’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 Handbook says its BackDROP rollover option is paid directly to a qualified plan with no income tax withheld, which avoids the withholding on the rolled-over part. 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”, provided the employee separated from service during or after the year of reaching 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.

Missouri income tax on MPERS payments

The Handbook states: “If you claim residence in Missouri, your retirement benefits are subject to state tax”. Missouri’s treatment is covered at Missouri retirement taxes and does Missouri tax pensions.

Where the sources disagree

When the election can still be changed. The Handbook’s death-after-retirement section says “The payment option you select cannot be changed after your effective date of retirement, except under certain circumstances”. Its payment-option section says “Your payment option may be changed anytime prior to MPERS distributing your first benefit payment”, and the brochure says “You can rescind or make changes to your MPERS benefit elections up until your first benefit payment is issued”. The first wording points to the effective date and the others to the first payment; ask MPERS which controls for a given date. For the Year 2000 Plan and 2011 Tier the statute settles it. RSMo 104.1027(7) says “A member may change a member’s election made under this section at any time prior to the system mailing or electronically transferring the first annuity payment to such member.” For the Closed Plan, RSMo 104.090(4) says “The election may be made only in the application for retirement, and such application shall be filed at least thirty days but not more than ninety days prior to the date on which the retirement of the member is to be effective, provided that if either the member or the spouse nominated to receive the survivorship payment dies before the effective date of retirement, the election shall not be effective.”

How much a refund forfeits. One passage says “If you request a refund of your employee contributions, you will forfeit all rights to benefits for that period of service”, and another says “Receiving a refund of your employee contributions forfeits all rights to benefits from MPERS”. A member with more than one period of service should ask MPERS how far the forfeiture reaches, but for the 2011 Tier the statute speaks to it. RSMo 104.1091 subsection 8(6)(e) says “A vested former member or a former member who is not vested who receives a refund shall forfeit all the member’s credited service and future rights to receive benefits from the system and shall not be eligible to receive any disability benefits; provided that any member or vested former member receiving disability benefits shall not be eligible for a refund.”

A survivor factor in the BackDROP example. The Handbook’s BackDROP note says “reduction factor for the survivor option is applied on retirement date”. Its worked BackDROP example applies a survivor reduction factor of 0.8530, and its worked example without BackDROP applies 0.8410. The pages read do not explain why the two factors differ, so ask MPERS how the factor is set for a BackDROP election.

What this page could not settle

• The pages read do not state a current active-member count for MPERS, so none is given.
• The pages read do not state the current interest rate credited on 2011 Tier contributions, only the rule for setting it.
• The Closed Plan Handbook read does not describe a refund of contributions.
• The pages read do not say what vesting period applies to a 2011 Tier member who was not active on or after January 1, 2018. The statute sets two periods. RSMo 104.1091(7) says “The minimum credited service requirements of five years contained in sections 104.1018, 104.1030, 104.1036, and 104.1051 shall be ten years for members covered by this section.” Subsection 12(9) says “The minimum credited service requirements of five years contained in sections 104.1018, 104.1030, 104.1036, and 104.1051 shall be five years for members covered by this subsection.” Subsection 12 opens “Effective January 1, 2018, a member who is not a statewide elected official or a member of the general assembly shall be eligible for retirement under this subsection subject to the following conditions:” The body of 104.1091 mentions 2018 only there, so it does not say whether a person who left employment before that date is covered.
• The Special Tax Notice and the Comparison of Closed Plan and Year 2000 Plan brochures were not read, so whether a 2011 Tier refund can be rolled over is not settled here.
• The pages read do not describe spousal consent for a BackDROP election. The BackDROP subsection of the statute, RSMo 104.1024(6), contains no spousal consent requirement (a search of section 104.1024 for the word consent returns nothing); the consent rule is in RSMo 104.1027(2), which governs the form of the annuity: “If a member is married as of the annuity starting date, the member’s annuity shall be paid under the provisions of either option 1 or option 2 as set forth in subsection 1 of this section, at the member’s choice, with the spouse as the member’s designated beneficiary unless the spouse consents in writing to the member electing another available form of payment.”
• Uniformed Patrol rules, disability benefits, reemployment and the Closed Plan’s special benefit were not examined in depth, and the handbooks date from February 2021, so later rule changes are not reflected.

Common mistakes

• Treating the payment option as changeable after retirement: only narrow marriage, death and divorce exceptions are described.
• Choosing a survivor option without checking which spouse it names, since the spouse named at retirement keeps it unless a divorce reversion is filed.
• Taking a 2011 Tier refund without weighing the forfeited rights and the cost of restoring service later.
• Taking a BackDROP in cash without allowing for 20% federal withholding.

Related on this site: Missouri retirement taxes, does Missouri tax pensions, Missouri MOSERS retirement decisions, single-life versus joint-and-survivor pension, pension refund versus leaving it, 20% withholding on a pension lump sum and public pension retirement decisions by system.

Sources

• MoDOT and Patrol Employees’ Retirement System (MPERS), Year 2000 Plan and 2011 Tier Retirement Handbook (Revised February 2021): https://www.mpers.org/wp-content/uploads/Year-2000-Plan-and-2011-Tier-Handbook.pdf
• MoDOT and Patrol Employees’ Retirement System (MPERS), Closed Plan Retirement Handbook (Revised February 2021): https://www.mpers.org/wp-content/uploads/Closed-Plan-Handbook21.pdf
• MoDOT and Patrol Employees’ Retirement System (MPERS), Understanding Your Retirement Decisions: A Summary of Important Benefit Provisions (December 2022): https://www.mpers.org/wp-content/uploads/Understanding-Your-Retirement-Decisions22.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 16, 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.