While the rules are not yet final, the new rules for reporting of TRS contributions are now published in the Illinois Register. As you may now know, the Illinois Teachers Retirement System ("TRS") will require, beginning January 1, 2021*, monthly reporting instead of annual reporting of deductions for employee pension contributions. TRS has been working with employers and vendors for months preparing for a smooth transition for the change. The new rules also require all reporting for each year to be complete by July 10 following any school year. Because contributions cannot be "paid ahead," some schools worried that the new rules would cause problems with their annualized payment cycles. The proposed rules apparently address that issue, requiring in relevant part:
Contributions for work performed during the fiscal year are due to the System by July 10 of the following fiscal year. Effective July 1, 2020*, employers cannot accelerate the payment of contributions (i.e., send more than the statutory contribution rate) in order to meet the July 10 deadline. Rather, the employer must remit all contributions corresponding with each payroll occurring within that month. To be allowed to remit the appropriate contributions to TRS by the July 10 deadline, employers must report all payrolls that will cover the work performed during the fiscal year ended June 30, even if the members will be paid in July and August. The contributions due are based on the statutory rates in effect for the fiscal year of the report.
80 Ill. Adm. Code 1650.180(f)(as proposed, with emphasis added - rule not yet final). In other words, Employers need not fear that their annualization rules will cause penalties or require a change to their actual payroll. Employers will be expected to report all payrolls for work performed during that school year, even when pay is due to be paid in July and August. Although the rules are not yet final, it seems likely the final rules will include some version of the foregoing.
