Imperial County Retirement Decisions: Options, Refund (2026)

Updated October 7, 2026. Quick answer: A member of the Imperial County Employees’ Retirement System (ICERS) who retires chooses between the Unmodified allowance, which gives an eligible spouse or domestic partner 60%, and Options I to III, which reduce the monthly allowance, and Option IV, which provides other benefits approved by the Retirement Board and Actuary. The plan chosen cannot be changed after the first pension payment. A member who leaves before retiring can withdraw contributions less a charge not to exceed $25, or leave them on deposit. A taxable refund paid to the member carries 20% federal withholding, which does not apply in a direct rollover. The booklets cover Tier 1, Tier 2 and Tier 3.

What this page covers and what it does not

This page works from two member booklets published by the Imperial County Employees’ Retirement System (ICERS), both carrying a member letter dated January 1, 2020: one for Tier 1 and Tier 2 members and one for Tier 3 members. Any figure here is ICERS’s own, or is labeled as a computed example from assumed inputs.

On the name: “The retirement system is officially named the IMPERIAL COUNTY EMPLOYEES’ RETIREMENT SYSTEM.” The plan operates under “County Employees’ Retirement Law of 1937” for four employers: the County of Imperial, the Superior Court, LAFCO and ICTC. The booklets cover general and safety members, and the charts are labeled “General Members, Tier 1”, “General Members, Tier 2” and “General Members, Tier 3”. The pages read do not say which hire dates fall in which tier, so confirm the tier with ICERS before relying on a tier figure.

The booklets are summaries: “In the event of a discrepancy between the information contained in this handbook and the Laws and Policies from which the benefits and information are derived, the Laws and Policies will govern.” State tax questions are on California retirement taxes and does California tax pensions.

When a pension can start

The tests differ by tier, and each is an either-or list. The table restates the booklets; the Tier 3 general test, for example, reads “Is 52 years of age or older, and has retirement credit for 5 or more years of County/Courts/LAFCO/ICTC or reciprocal service (excluding public service credit), or”.

The booklets count County, Court, LAFCO, ICTC or reciprocal service and exclude public service credit from the count.

How the check is figured, with ICERS’s own examples

Tier 1 and Tier 2 average compensation over one year: “FAC is the monthly average compensation for the highest 12 consecutive months of employment used to determine a retirement benefit.” Tier 3 uses a longer window: “Final compensation for the purpose of calculating your retirement benefits means the average annual pensionable compensation of any three consecutive years elected by a member at or before the time he/she files an application for retirement, or if he/she fails to elect, the three years immediately preceding his/her retirement”.

Both booklets work the same case, a general member at age 60 with 25 years of service, starting from $30,000 (Tier 1 and Tier 2) or $90,000 over 36 months (Tier 3), and both reach an average monthly compensation of $2,500.00 that is multiplied by the chart percentage for the member’s age and service.

A computed check of ICERS’s own inputs: $30,000 divided by 12 is a computed $2,500.00, and $90,000 divided by 36 is a computed $2,500.00. Then $2,500.00 times 54.55% is a computed $1,363.75, $2,500.00 times 60.99% is a computed $1,524.75, and $2,500.00 times 45% is a computed $1,125.00, matching the booklets. A member belongs to one tier, so the three rows are not a menu of choices.

How and when to apply

“Applications for service, disability and deferred retirement allowance should be on file in the ICERS’ office 30 to 60 days prior to the effective date of retirement.”

There is a cancellation window: “Any member wishing to cancel retirement must notify the Retirement System in writing of cancellation up to and including 5:00 p.m. on the effective date of retirement as stated on the member’s application.”

The election: five payment choices and one permanent decision

Both booklets list the same allowance choices. The Unmodified allowance “Provides the maximum retirement allowance a member may receive and upon the member’s death, a 60% continuance to the spouse or domestic partner”. Options I to III reduce the allowance in exchange for a different survivor feature, and Option IV leaves the survivor feature to the Board.

On Option II the booklet adds: “A change of beneficiary is not permitted under this option.”

The pages read do not state how much Option I, II, III or IV cuts the monthly allowance, so a real quote must come from ICERS. The general trade-off is covered on single-life versus joint-and-survivor pension.

What each choice does for a survivor, with an assumed example

A computed example from assumed figures, not ICERS figures: if an assumed Unmodified allowance is $3,000 a month, a 60% continuance is 60% of $3,000, a computed $1,800 a month. If an assumed reduced allowance under Option II is $2,400 a month, a 100% continuance is a computed $2,400 a month, and under Option III the 50% continuance of an assumed reduced $2,400 is a computed $1,200 a month. The reduced $2,400 is an assumed input, since the booklets do not publish the reductions. See also survivor benefit with a government pension.

What is irrevocable, and who counts as a survivor

The key sentence is short: “The plan the member selects may not be changed after the first pension payment has been issued”. Because the booklet says no change of beneficiary is permitted under Options II, III and IV, a named survivor under those choices cannot be swapped if the relationship changes. Only Option I says the beneficiary may be changed. The booklet adds that a “Beneficiary must have an insurable interest in the retiree’s life”.

For the Unmodified 60%, the booklet’s survivor rule uses time-in-relationship tests. One route is that the survivor “Surviving spouse or domestic partner was married or registered as a domestic partner at least one year prior to retirement”. Another route requires that the spouse or partner was married or registered at least two years before death, had reached age 55, and that no other person was designated by a court order as a payee. “If there is not a qualified spouse or domestic partner, the unmarried children may receive the same benefit until attaining age 18 or 22 if enrolled full-time in an accredited school, as determined by the Board of Retirement.”

The booklet also notes that California is a community property state and that “certain retirement benefits may be subject to division by the court in the event of a Dissolution of Marriage”. Confirm the facts of a specific marriage or partnership with ICERS.

Lump sums: what the documents describe

In the booklets read, lump sums appear in the refund of contributions after leaving, in the death benefit on deferred status, in the death benefit for a member who dies in service (a beneficiary may receive it in a lump sum or in 120 equal monthly installments), in a one-time lump sum for the surviving spouse or domestic partner of a safety member killed by external violence, and in the Option I payment of contributions to a beneficiary. For death while on deferred status, the booklet says “The member’s designated beneficiary will receive the member’s contributions plus interest”.

The pages read do not describe a lump-sum retirement option, a partial lump sum or a deferred retirement option plan (DROP). The cash choice at leaving is the refund, covered below. For comparing a lump sum with a lifetime check in general, see pension lump sum versus monthly annuity break-even.

Leaving before retirement: the choices

A member who leaves has three paths in the booklets. The first is a deferred retirement: “Members terminating employment who have completed five years of service may elect in writing within 180 days of termination of employment to leave their accumulated contributions with the retirement system and take a deferred retirement”. “A member on deferred retirement without reciprocal benefits must retire by April 1st in the year in which the member reaches age 70 ½”.

The second is for members with less than five years: “A member who is credited with less than the number of years of service required for vesting (5 years) shall have the right to elect to leave accumulated contributions on deposit in the retirement fund.” “Failure to make an election to withdraw accumulated contributions shall be deemed an election to leave accumulated contributions on deposit in the retirement fund.” “The member’s contributions are paid interest.”

The third is reciprocity with another system. “Members may combine the service in both systems to meet the minimum requirements for service retirement, disability retirement and death benefit.” On concurrent retirement, the Tier 1 and Tier 2 booklet bases the allowance on a one-year average and the Tier 3 booklet on a three-year average of pensionable compensation in either system. “Any member desiring to take advantage of these benefits is requested to contact ICERS prior to leaving service in order to sign an application and give information concerning reciprocity.”

A deferred retirement is not locked in: “Members may rescind their request for deferred retirement prior to the effective date of their retirement”, and the member may “withdraw their accumulated contributions, provided they have not elected to receive reciprocal benefits in another retirement system”.

Taking a refund: what it costs and what it ends

A refund is the exit choice. “Members terminating service may withdraw their accumulated contributions, less a withdrawal charge not to exceed $25.00.” “All employees terminating employment must submit the proper documentation to our office to receive a refund of contributions.” On timing, ICERS says refunds “are processed on the last working day of the month following the month of termination from service”.

There is no way in while employed: “Members may not borrow, withdraw, or use as collateral any of their accumulated contributions while employed.”

What a refund ends is not spelled out in the booklets. They describe the allowance as built from the member’s contributions, service credit and the employer contributions held for the member, and they say “A member does not benefit from the employer contributions until he/she receives a monthly pension”. The redeposit rule below implies that withdrawn service is restored only if the money is put back. The pages read do not describe a spousal consent form for a refund. More on the choice is on pension refund versus leaving it.

How a refund is taxed and what is withheld

ICERS explains that “Interest and pretax contributions are not subject to Federal or State income tax until funds are withdrawn from the retirement system, at which time it is reportable for tax purposes”. The federal rules sit on top. A computed example from an assumed $10,000 taxable refund paid to the member, not an ICERS figure: the $25 maximum charge would leave at least $9,975 before tax. Separately, 20% of an assumed $10,000 is a computed $2,000 withheld for federal tax, leaving a computed $8,000 in cash before any other withholding. The final tax can be more or less than the withholding. See 20% withholding on a pension lump sum.

Coming back and buying service credit

A returning member can rebuild withdrawn service: the booklet says “A member may redeposit accumulated contributions previously withdrawn, plus interest accrued from date ofseparation from the system at any time prior to presenting an application for retirement and receives credit for such service”. Purchases of other service have a deadline: “A MEMBER WHO ELECTS TO PURCHASE RETIREMENT SERVICE CREDIT SHALL COMPLETE THAT PURCHASE WITHIN 120 DAYS AFTER THE EFFECTIVE DATE OF HIS OR HER RETIREMENT”. The booklets add that members “may now do so by transferring funds from either a 457, or a 403(b) plan, or a traditional Individual Retirement Account”.

Two rules narrow the buying. For an uncompensated leave of absence due to illness, “Credit may not be received for any period of such absence in excess of 12 consecutive months”. For military service, the booklet gives credit to a member who resigned or took leave to enter the armed forces and returned to service within one year after separation under honorable conditions, “if, before retirement he or she contributes what he or she would have contributed at the time of resignation plus interest, if the service is not a basis for military retirement pay”.

Cost comes from ICERS, not from a table in the booklets. A computed example from assumed numbers, not ICERS figures: if an assumed $20,000 purchase raised the pension by an assumed $250 a month, it would take $20,000 divided by $250, a computed 80 months, or about 6.7 years, to recover. See the pension buyback calculator.

Cost-of-living raises, rehire and benefit limits

The cost-of-living line is cautious: “All retirees and employees who retire prior to April 1st of each year MAY receive an annual 2% cost of living raise.” Because the booklet’s word is capitalized as a permission and not a promise, do not treat the raise as guaranteed; confirm the current rule with ICERS.

After retiring, “Most retirees who are eligible to be employed by any one of the ICERS employers must be retired for a minimum of 180 days prior to returning to service”.

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 ICERS’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 ICERS booklets read do not describe a rollover election, so ask ICERS whether a direct rollover is offered; the IRS says the mandatory withholding does not apply in a direct rollover. 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 pages read do not state how much Option I, II, III or IV reduces the monthly allowance.
• The pages read do not state which hire dates fall in Tier 1, Tier 2 or Tier 3.
• The pages read do not describe a lump-sum retirement option, a partial lump sum or a DROP.
• The pages read do not state the interest rate credited on contributions, only that the Board of Retirement can change it.
• The pages read do not state a spousal consent requirement for a refund, or describe a rollover election.
• The pages read do not give a price for any service credit purchase.
• Both booklets carry a member letter dated January 1, 2020; a rule changed since then is not reflected here, and the cost-of-living figure should be confirmed with ICERS.
• The percentage charts beyond the printed examples, disability retirement, and retiree health insurance were not worked through for this page.

Common mistakes

• Treating the option as changeable later; the booklets say the plan cannot be changed after the first pension payment.
• Choosing Option II, III or IV and expecting to swap the beneficiary; the booklets say no change is permitted under those options.
• Taking a refund without weighing what ends; the booklets do not spell out what a refund ends, and the redeposit rule suggests the credit returns only if the money is put back before retirement.
• Expecting a refund check in full; a withdrawal charge of up to $25 applies and a taxable refund paid to the member carries 20% federal withholding.
• Applying too early or too late; the booklets say an application should be on file 30 to 60 days before the effective date of retirement.

Related on this site: California retirement taxes, does California tax pensions, pension refund versus leaving it, single-life versus joint-and-survivor pension, pension buyback calculator, 20% withholding on a pension lump sum, pension lump sum versus monthly annuity break-even, survivor benefit with a government pension and public pension retirement decisions by system.

Sources

• Imperial County Employees’ Retirement System (ICERS), Retirement Benefits Booklet for Tier 1 and Tier 2 General and Safety Members (member letter dated January 1, 2020): https://icers.imperialcounty.org/wp-content/uploads/2020/09/RetirementBookletTier12REV920.pdf
• Imperial County Employees’ Retirement System (ICERS), Retirement Benefits Booklet for Tier 3 General and Safety Members (member letter dated January 1, 2020): https://icers.imperialcounty.org/wp-content/uploads/2020/09/RetirementBookletTier3REV0920.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 7, 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.