Updated October 30, 2026. Quick answer: The Michigan State Police Retirement System has two tiers, and the ORS booklet covers only members whose oath was taken before June 10, 2012. For that group a full pension is 60% of final average compensation at any age with 25 years of service, and the DROP defers retirement for up to six years into an account earning 3% interest, a choice that is irrevocable once accepted. Members hired on or after that date are in the Hybrid tier: age 55 with 25 years or age 60 with 10, 2% of average pay per year of service up to 25 years, and no DROP. A refund of contributions cancels the service credit.
More on public pension COLAs for 2027: the Michigan State Police COLA for 2027 and the 2% rule.
What this page covers and which tier each statement belongs to
The Michigan State Police Retirement System (MSPRS) is administered by the Michigan Office of Retirement Services (ORS). This page works from the ORS booklet Your Retirement Overview (form R0159H, not dated on its face), the actuarial valuation as of September 30, 2024, a May 2026 board presentation of the 2025 results, and five ORS web pages, all read on October 30, 2026.
The system has two tiers, and the booklet speaks to only one. It says “This book is intended for those in the Michigan State Police Retirement System whose oath was taken before June 10, 2012”. The valuation sets out plan provisions in two blocks, one “for Plan Members That Were Hired Before June 10, 2012” and one “for Plan Members That Were Hired on or After June 10, 2012”. The second block is the Hybrid tier, which the valuation also calls Pension Plus (PPP).
On size, the valuation’s active-member table lists 286 Non-Hybrid and 1,330 Hybrid (PPP) members at September 30, 2024, so most active members are in the tier the booklet does not describe. The 2025 presentation, which does not split actives by tier in its text, reports as of September 30, 2025: “Current active members: Vested 602 Non-vested 1,058 Total 1,660”.
When a pension can start
For members whose oath was taken before June 10, 2012, the booklet says “You’re eligible to retire at any age when you have the equivalent of 25 years of full-time service as an enlisted officer”. A member who leaves with fewer than 25 years has a separate path: “If you leave Michigan State Police employment with more than 10 but fewer than 25 years of service, and you haven’t taken a refund of any personal contributions on your account, you will qualify for a deferred retirement pension at age 50”.
For members hired on or after June 10, 2012 (Hybrid), the valuation lists regular retirement as “Age 55 with 25 years credited service; or age 60 with 10 years credited service”.
How the pension is figured, tier by tier
Hired before June 10, 2012: the valuation states the amount this way: “If member has 25 or more years of credited service, 60% of final average compensation; if member has less than 25 years of credited service, total credited service times 2% of final average compensation”. The base is a two-year average, which the booklet describes as “the average annual salary earned for your last two YOS with the Michigan State Police”.
A computed example from an assumed $90,000 two-year average, not a Michigan figure: with 25 or more years the pension is 60% of $90,000, a computed $54,000 a year or $4,500 a month, before any survivor reduction.
Hired on or after that date (Hybrid): the valuation gives the amount as “Total credited service times 2% of final average compensation, up to 25 years of service”, and says “Benefit multiplier declines by 0.4% for each year after 25 years of service until reaching 0% after 30 years of service”. The base differs: “Average of 5 final years of compensation excluding overtime”.
A computed example from an assumed $80,000 five-year average, not a Michigan figure: a Hybrid member with 25 years gets 2% of $80,000 for each of 25 years, a computed $40,000 a year or $3,333 a month, before any survivor reduction. Hybrid members also have a separate defined contribution account, which this page does not price.
Survivor choices: what the documents say and do not say
Survivor rules depend on the hire date.
| Hire date | Survivor coverage | Effect on the member’s pension |
|---|---|---|
| Hired on or before July 1, 2006 | The retired member’s benefit continues to the surviving spouse; if there is no spouse, children under 18 share it until 18 | The pages read state no reduction for this group |
| Hired after July 1, 2006 and before June 10, 2012 | Survivor benefits of 100%, 75% or 50% continuation | The retired member’s benefit is actuarially reduced for the survivor coverage |
| Hired on or after June 10, 2012 (Hybrid) | Normal form is a straight life annuity; the member may elect 100%, 75% or 50% joint and survivor with pop-up at retirement | The option forms are actuarially equivalent to the straight life annuity |
For the second group the valuation says “For plan members hired after July 1, 2006, survivor benefits are available (100%, 75%, or 50% continuation) but the retired member’s benefit is actuarially reduced for this survivor coverage”. The booklet adds that “Employees hired after July 1, 2006, will choose from survivor options that are actuarially reduced based on the survivor’s age”. For the Hybrid group it says that “for System members hired after July 1, 2006 the normal form of payment is a straight life annuity”, and that “These individuals may elect one of the following optional forms of payment at the time of retirement”, and “The option forms of payment are actuarially equivalent to the straight life annuity”. It uses the term pop-up without defining it, so its meaning should be confirmed with ORS.
The ORS survivor web page, which names no tier, says “Your surviving spouse and/or eligible children under age 18 will receive the same pension and insurance coverage you were receiving”. It limits coverage: “You have to be receiving a disability pension or a full retirement pension based on 25 or more years of service for your surviving spouse and/or minor children to be eligible for coverage”. How a choice between the percentages trades monthly income against protection is the general question at single-life versus joint-and-survivor pension, and the government-pension angle is at survivor benefit with a government pension.
The DROP: the one election the booklet calls irrevocable
The Deferred Retirement Option Plan is for the older tier: the valuation says “Pension Plus members are not eligible for the DROP”, and the booklet describes a DROP created for members hired before June 10, 2012. The booklet explains: “The DROP is a supplemental benefit program available to members who are eligible to retire, but who agree to defer their retirement and continue working and receiving active employee wages”. On eligibility, it says “If you have 25 or more years of credited service, you may elect to participate in the DROP”.
The booklet’s warning is plain: “Once your DROP application is accepted, your participation in the program is irrevocable”. The member picks the length, “defer your pension benefits up to a maximum of six years”, and “ORS calculates a DROP amount based on your pension value and credits this amount each month during the DROP period to an interest-bearing account in your name”. The percentage credited depends on the length chosen.
| DROP period | Percent of monthly pension deferred |
|---|---|
| Less than one year | 30% |
| One year but less than two | 50% |
| Two years but less than three | 60% |
| Three years but less than four | 70% |
| Four years but less than five | 80% |
| Five years but less than six | 90% |
| Six years | 100% |
The booklet says “Your pension is based on the average of your two final years of total earnings before the DROP, called final average compensation (FAC), times 60% (0.60)”. It adds that “If your salary changes during your DROP period, ORS will not recalculate your DROP benefit or your pension amount”, and “Your DROP account will earn 3% interest each year, prorated for any fraction of a year”.
A computed example from assumed inputs, not a Michigan figure: take the assumed $4,500 monthly pension from the example above and an assumed DROP period of three years. The chart’s percentage for that period is 70%, so the monthly credit is 70% of $4,500, a computed $3,150, and 36 monthly credits come to a computed $113,400 before the 3% interest. ORS performs the real calculation and should be asked to confirm the monthly mechanics.
The costs of the choice, in the booklet’s words: “you will not accrue any additional years of service toward retirement as a DROP participant”; “If you leave before your DROP end date for any reason (disability, death, job termination, etc.), the value of your DROP account will be recalculated based on the number of months you worked”; and “During your DROP period, your pension is not eligible for the annual post-retirement increases of 2%, not to exceed $500 annually”.
DROP death benefits and what happens when it ends
On death in the DROP the booklet says “If you die while participating in the DROP, your pension beneficiary will receive your monthly pension benefit. In addition, your designated DROP beneficiary will receive the balance of your DROP account”. When the DROP ends, “Your retirement effective date will be the first of the month after your DROP termination”. The booklet lists these choices: “Take a total lump-sum distribution”, “Take a partial lump-sum distribution and leave the balance in your DROP account to draw from at a later date”, and “Transfer the balance to another qualified plan”. A fourth is to leave the balance on deposit, with limits: “Money left on deposit in the DROP account can only be withdrawn up to four times per calendar year”.
Taking the DROP as a lump sum or rolling it over
The ORS distribution page confirms the choices and adds that the DROP account “will continue to earn 3% interest” if the balance is left. On tax, it says “State police are exempt from the IRS’ 10% early withdrawal penalty if they are age 50 or older when they take their lump-sum DROP distribution”.
A computed example from an assumed $100,000 taxable distribution, not a Michigan figure: if a lump sum were paid to the member, 20% of $100,000 is a computed $20,000 withheld, leaving a computed $80,000 before any further tax. The documents read do not say whether ORS withholds this on a DROP lump sum; 20% withholding on a pension lump sum covers the general rule.
Leaving before retirement: leave the money or take a refund
Vesting comes from the ORS membership page: “You are vested when you have the equivalent of 10 or more years of full‑time Michigan State Police employment”. It adds a condition: “To remain vested, you need to leave any personal contributions on account, where they continue to earn interest”. A member who leaves before reaching the minimum service has a choice, and the ORS service credit page says “you can request a refund of your accumulated personal contributions and interest (refunds cancel all service credit you accrue prior to the refund, and you will not be able to repay the refund to restore your service credit at a later date)”.
That is the refund trade as the page states it: the contributions come back with interest, and the service credit is cancelled with no way to restore it. A refund also closes the deferred path, since the booklet’s deferred pension at 50 requires that the member has not taken one. On death before eligibility, “If you die before reaching retirement eligibility and have personal contributions remaining in your account, any balance is paid to your beneficiary or estate”. The general question is at pension refund versus leaving it.
Buying service credit
The ORS service credit page says what a purchase cannot do: “You cannot buy service credit to reach the 10-year vesting requirement”. It has a timing limit: “You must be actively employed with the state police to buy service credit and must pay for the purchase in full before leaving state police employment”. And it has a waste rule: “If you purchase more service than is necessary to retire, your payment cannot be refunded”. The booklet gives the example of 23 years earned plus 2 years bought, which reaches 25.
On cost, the booklet’s chart lists nonintervening active duty military service at “5% of full-time compensation in the year that you make payment”, and maternity, paternity or child rearing credit and VISTA or Peace Corps credit at “Actuarial cost”. On limits, it says “A maximum of 2 years combined nonintervening military and VISTA/Peace Corps can be purchased”. The break-even question is at pension buyback calculator. The documents read do not say whether Hybrid members can buy service credit on the same terms.
Cost-of-living increases
For the older tier the booklet says “You can look forward to a fixed 2% annual increase, not to exceed $500, beginning with the second October after your retirement effective date. The 2% increase does not compound, but it does accumulate”. For Hybrid members the valuation lists “Post-Retirement Cost-of-Living Adjustments: None”. The documents read do not explain the difference.
Applying, and the timing windows
The booklet sets the date and the filing window: “Your retirement effective date is the first day of the month following the month in which you’ve met all eligibility requirements, submitted your application, and you’ve terminated employment with the Michigan State Police”. It also says “You must submit your completed retirement application to ORS at least 30 days, but no more than 90 days, before your retirement effective date”. For a deferred pension, the ORS page warns that the pension “won’t be any higher if you wait”.
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 MSPRS’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 ORS pages read list a transfer of the DROP balance to another qualified plan as one of the choices, so the rollover rules matter for that choice. 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.
Where the sources disagree
First, the exact 10 years case. The booklet and the ORS deferred retirement page describe the deferred pension for a member who leaves with more than 10 but fewer than 25 years, while the ORS membership page says “You are vested when you have the equivalent of 10 or more years of full‑time Michigan State Police employment” and the valuation lists deferred eligibility as 10 years of credited service. A member with exactly 10 years should ask ORS which wording governs.
Second, the deferred starting age. The booklet and the ORS deferred retirement page say age 50, and the web page names no tier, while the valuation lists the Hybrid deferred benefit as “10 years of credited service. Benefit commences at age 60”. A Hybrid member should check with ORS before relying on age 50.
What this page could not settle
- The survivor option menu for members hired before June 10, 2012 is not spelled out in the booklet or the ORS web pages read; the 100%, 75% and 50% figures come from the actuarial valuation, and the ORS Survivor Option Factors table was not among the documents read.
- The pages read do not state whether a survivor election can be changed after retirement. The only election they call irrevocable is the DROP.
- The pages read do not state the size of any survivor reduction, how the pop-up works, whether a spouse must consent, or whether ORS withholds 20% from a DROP lump sum.
- None of the ORS web pages read names the Hybrid tier, and no ORS guide for Hybrid members was among the documents read, so Hybrid refunds, interest on contributions, the defined contribution payout and service purchases are not covered.
- The full September 30, 2025 valuation report was not posted; the tier counts come from the 2024 valuation. Disability, retiree insurance and pre-retirement survivor benefits were not examined in depth.
Common mistakes
- Using the booklet’s rules for a member hired on or after June 10, 2012; the booklet’s cover limits it to oaths taken before that date.
- Entering the DROP without weighing that the booklet calls participation irrevocable once the application is accepted.
- Expecting the older tier’s 2% yearly increase in the Hybrid tier; the valuation lists none.
- Taking a refund and expecting to restore the service credit later; the ORS page says the refund cannot be repaid to restore it.
Related on this site: single-life versus joint-and-survivor pension, pension refund versus leaving it, 20% withholding on a pension lump sum, pension buyback calculator, survivor benefit with a government pension and public pension retirement decisions by system.
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Answer againSources
- Michigan Office of Retirement Services, Your Retirement Overview, Michigan State Police Retirement System (form R0159H, PDF created April 2026, not dated on its face): https://www.michigan.gov/orsmsp/-/media/Project/Websites/orsmsp/SPRS-Forms/R0159H_Your_Retirement_Overview.pdf
- Michigan State Police Retirement System, Annual Actuarial Valuation Report, September 30, 2024 (prepared by Gabriel, Roeder, Smith and Company, letter dated April 15, 2025): https://www.michigan.gov/orsmsp/-/media/Project/Websites/orsmsp/ARCHIVE/Special-Reports/2025/SPRS—Pension_2024(20250415).pdf
- Michigan State Police Retirement System, Pension Actuarial Valuation Results as of September 30, 2025 (board presentation, May 21, 2026 board meeting): https://www.michigan.gov/orsmsp/-/media/Project/Websites/orsmsp/ARCHIVE/Special-Reports/2026/SPRS_PensionPresentation_2025-(20260416).pdf
- Michigan Office of Retirement Services, Survivor Pension (State Police Retirement System web page): https://www.michigan.gov/orsmsp/available-benefits/survivor-pension
- Michigan Office of Retirement Services, Distribution of DROP (State Police Retirement System web page): https://www.michigan.gov/orsmsp/deferred-retirement-option-plan/distribution-of-drop
- Michigan Office of Retirement Services, Earning and Purchasing Service Credit (State Police Retirement System web page): https://www.michigan.gov/orsmsp/service-credit
- Michigan Office of Retirement Services, Deferred Retirement (State Police Retirement System web page): https://www.michigan.gov/orsmsp/available-benefits/deferred-retirement
- Michigan Office of Retirement Services, Who Is a Member? (State Police Retirement System web page): https://www.michigan.gov/orsmsp/about-your-plan/who-is-a-member
- 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 30, 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.