Updated October 30, 2026. Quick answer: In the Teachers’ Retirement System of Illinois, Tier 2 requires age 67 and at least 10 years of service credit for a nonreduced benefit, and members may retire at 62 with 10 years at a reduction of 6 percent for every year under 67. Tier 1 members, who first contributed before January 1, 2011, may retire at 62 with 5 years, 60 with 10 years, or 55 with 20 years. The formula is 2.2 percent of final average salary per year of service, capped at 75 percent.
Tier 1 and Tier 2
TRS defines the tiers by first contribution date: “Tier 1 • First contributed to TRS or reciprocal retirement system prior to January 1, 2011 • Tier 2 • First contributed to TRS or reciprocal retirement system on or after January 1, 2011”.
Tier 2 eligibility
The Tier 2 member guide says: “Tier 2 requires teachers and administrators to be 67 years old and have accumulated at least 10 years of service credit in order to qualify for nonreduced benefits that a member has earned.” “Tier 2 members may retire at age 62 with at least 10 years of service but will receive retirement benefits reduced 6 percent for every year the member is under age 67.”
Tier 1 eligibility
TRS’s Tier 1 presentation lists: “Tier 1 • Age 62 with a minimum of 5 years of service • Age 60 with a minimum of 10 years of service • Age 55 with a minimum of 20 years of service*”.
The Tier 1 reduction
“If you retire between the ages of 55 and 60 with at least 20 but fewer than 35 years of service, your retirement annuity is reduced by 6 percent for each year (half percent per month) that you are under age 60.”
State agency employees
“If you are a TRS member currently employed by a state of Illinois agency, you may retire under the Rule of 85 if you meet eligibility criteria.”
What the pension is based on
“Benefits will still be determined by the formula of 2.2 percent multiplied by final average salary multiplied by years of creditable service.” “Benefits will be based on the member’s highest average salary earned during eight consecutive years out of the last 10 years of service with one exception.” Tier 1 averages differently: “Average salary is the average of the four highest consecutive annual salary rates within the last 10 years of creditable service with one exception.” The cap: “The maximum benefit a member can receive is 75 percent of his or her final average salary.”
A worked example with invented numbers
Take an invented Tier 2 member with 30 years of service credit who retires at 67. That is 30 years at 2.2%, or 66% (computed) of a final average salary of $75,000 (invented, for the computation), which comes to $49,500 a year (computed).
Now take the same member retiring at 62. That is 30 years at 2.2%, or 66% (computed) of a final average salary of $75,000 (invented, for the computation), which comes to $49,500 a year (computed). The reduction is 5 years under age 67 at 6% each, which is 30% (computed). The pension after the reduction is $34,650 a year (computed).
What the documents do not say
The Tier 1 guide prints the age and service table as a table, so the Tier 1 ages are quoted from the list in TRS’s Tier 1 presentation. The Rule of 85 appears in one sentence for state agency employees with no criteria stated. Tier 1 service before July 1998 uses a graded formula that is not worked through. The vesting term is not stated separately beyond the 5-year (Tier 1) and 10-year (Tier 2) minimums in the eligibility lists. The Chicago Teachers’ Pension Fund and reciprocal-service rules are not covered.
Common mistakes
- Assuming the Tier 1 ages apply to a teacher who first contributed on or after January 1, 2011.
- Treating the age 55 route as unreduced. Tier 1 reduces it 6 percent for each year under 60 unless the member has 35 years of service.
- Applying these rules to the Chicago Teachers’ Pension Fund, which is a separate system.
Related: Illinois TRS retirement decisions, the Illinois TRS COLA for 2027, how public pension decisions work, and whether Illinois taxes pensions.
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Answer againSources
- Teachers’ Retirement System of the State of Illinois, EXPRESS! For Tier 1 Members: www.trsil.org
- Teachers’ Retirement System of the State of Illinois, Tier 2 Member Guide, Chapter 9: Retirement Benefits: www.trsil.org
- Teachers’ Retirement System of the State of Illinois, Tier 1 Member Guide, Chapter 9: Retirement Benefits: www.trsil.org
- Related official page (not quoted): IRS Tax Topic 410, Pensions and annuities: www.irs.gov
- Related official page (not quoted): IRS Tax Topic 411, Pensions: the General Rule and the Simplified Method: www.irs.gov
Read from the primary documents linked above on October 30, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer or the IRS itself is the right place to confirm anything consequential.