CORRECTION—The DCP Contribution Limits table contained an error. Please refer to the corrected table below.

Employer Reporting Server Outage

Access to Employer Services has been restored for State of Alaska and Municipality of Anchorage to submit employer payrolls. This is a different system than other political subdivisions use to report payroll data. To date, eReporting has only been partially restored but the Division of Retirement and Benefits (Division) has a work-around to input Political Subdivision employer payrolls internally. Employers are being contacted individually by their Division Active Payroll Contact regarding how to submit payroll data to the Division until eReporting is accessible by all employers. Your responsiveness will assist us in processing payrolls expeditiously. We do not have a timeline for when eReporting will be accessible. Thank you for your patience.

Reporting Scattered Leave Without Pay

Employers are required to report to the Public Employees’ Retirement System (PERS) all periods of service, dates of birth, compensation, new entrants into service, death, and other employee data necessary for the proper and effective operation of the system. (AS 39.35.070)

Periods of leave without pay (LWOP) for full-time employees are required to be reported to the PERS with each payroll processing. Scattered LWOP (hours of leave taken intermittently during a calendar year) for full-time members are not able to be reported through the current payroll system.

LWOP that does not exceed 10 accumulated days in a calendar year is not considered an interruption or break in service. However, if the LWOP exceeds 10 accumulated days, whether taken consecutively or scattered throughout the calendar year, the employee’s service credit for that year will be reduced by the equivalent number of days they were on LWOP, including the 10 days. (AS 39.35.330)

Employers must report all periods of LWOP, including scattered hours, to the PERS, even if the period of leave or total number of scattered hours is less than 10 days. Employers are not being asked to determine when 10 days would have accumulated to begin reporting, all periods of LWOP and scattered hours must be reported to the PERS.  

Employers are required to submit an annual report of all employees who had taken scattered LWOP throughout the preceding calendar year by January 31 each year.

This can be reported using the Verification of Service form (02-1883) or as a separate report.

The Scattered Leave report should include the following:

• Employee name
• Last 4 of employee SSN
• Total number of scattered hours per calendar year

Employers must send the Scattered Leave report to their payroll contact within the Division.

Pay Period End Dates

Consistency is Key to Ensuring Correct Reporting

Accurate reporting of Pay Period End (PPE) dates and the associated issue date is critical for ensuring salaries are assigned to the correct calendar year, determining eligibility for voluntary benefits, and testing for Internal Revenue Code limitations.

Earnings and contributions should always be reported to the Division with the same PPE and Issue dates that are used when paying your employees. For example, if you pay your employees semi-monthly, then they should be reported to the Division on a semi-monthly basis, not a monthly basis.

Submitting inconsistent PPE dates may delay posting of contributions to member accounts. Payroll files will need to be corrected if submitted with an inaccurate PPE date.

The Difference Between PPE Date and Issue Date

• PPE date: End date of the payroll cycle in which employees worked or earned wages that they are being paid for.
• Issue date: Paycheck date or the actual date employees are paid.

Examples of PPE Dates

Generally, please be sure reported PPE dates are consistent for your payroll cycle. If there are exceptions, please make sure to notify your payroll contact.

Monthly Pay Cycle

A monthly pay cycle can have a PPE date as any day of the month but should be a consistent date each month. The PPE date will always be the same day of the month or the last day of the month.

For Example:

Semi-monthly Pay Cycle

A semi-monthly pay cycle would always run from the 1st through the 15th and the 16th through the last day of the month. In this scenario, the PPE date will always be reported as the 15th of the month or the last day of the month.

Bi-weekly Pay Cycle

A bi-weekly pay cycle will always be 14 days.

For example:

Weekends and Holidays

An employer PPE date should not change due to a weekend or a holiday.

Weekends

The Division frequently encounters PPE errors when an employer reporting as semi-monthly or monthly finds their pay period ending date falling on a weekend.

For example:

Holidays

If the PPE date would normally be May 31, the employer should still report May 31 as the PPE date despite May 31 being a holiday. 

Exceptions to Submitting Consistent PPE Dates

The only exception for not submitting an expected PPE date based on payroll cycle is at teacher service year-end for TRS employers.

Please work with your Division payroll contact to determine the correct PPE dates for school year-end reporting.

Questions?

If you have any questions as to what PPE date should be submitted or if you need to change your pay cycle, please reach out to your Division payroll contact.

What to Do if a DCR Contribution Was Submitted Incorrectly

There are times when an employer will need to back out ineligible contributions that were submitted to Retirement and Benefits. When this happens there are a couple of things you need to be aware of pertaining to backing out contributions from the Defined Contribution Retirement Plan (DCR). 

Reasons for DCR backouts

• Member enrolled in DCR when member is eligible for Defined Benefit Plan (DB)
• Incorrect SSN submitted which created a separate account for the member
• Ineligible contributions (concurrent service, ineligible wages)

Employer Responsibility

Per statute, if a DCR member’s contributions must be backed from Empower Retirement for PERS, TRS, SBS or DCP, the employer is responsible for all Empower Retirement fees and market losses associated with the ineligible contributions.  If the member does not have enough funds in his/her account to cover the contributions being backed out, the shortage will be added to the employer’s over/short account as an amount owed by the employer related to the full back out.  

Relevant Statutes:

PERS Sec. 39.35.770. Transmittal of Contributions; Claims Against Funds of an Employer, and

 (c) Employers are responsible for administrative fees, investment fees, and investment losses charged to accounts established under AS 39.35.730 resulting from contribution adjustments due to employers enrolling members in the plan before the members are eligible for membership. Contributions made by employees shall be returned to the employer by reducing future employee contributions due. Contributions, net of fees and investment losses, made by employers shall be used to reduce future employer contributions due.

TRS Sec. 14.25.370. Transmittal of Contributions; Claims Against Funds of an Employer

(c) An employer is responsible for administrative fees, investment fees, and investment losses charged to accounts established under AS 14.25.340 resulting from contribution adjustments because the employer enrolled a member in the plan before the member was eligible for membership. Contributions made by an employee shall be returned to the employer by reducing future employee contributions due. Contributions, net of fees and investment losses, made by an employer shall be used to reduce future employer contributions due.

Entering Term Dates

When an employee terminates his or her employment, remember to submit termination dates for each plan an employee is enrolled in. Each plan is independent of one another and a termination date submitted in one plan does not post a term date in another plan. 

Employees must have a term date before they can refund their retirement accounts. We’ve had many instances where a member has attempted to refund their account, only to encounter a delay due to not having a termination date on file. Timely submission of termination dates will allow employees to refund their accounts timely and also reduce the number of inquires made to you, the employer, to check the status of a member.

Making the Switch: Moving from Checks to Electronic Payments

The Division encourages employers to switch over to electronic payments for faster processing.

Electronic payments are more efficient, less costly, and less vulnerable to fraud.   Employers can reduce the likelihood incurring late fees since checks require moving through the postal system and an additional two or three days to clear the bank.  Funds are not considered received until the deposit is available the State’s bank account.

There are two payment options for making an electronic payment:

1. eReporting ACH with Bank Account Activation (preferred method)

   • Go to eReporting
   • Open the Banking Tab
   • Set-up EFT
   • Bank account will be PENDING until your financial institution finalizes approval
   • Once ACTIVE, you can submit payment with ACH
   • Payment is submitted with payroll, and only the Signed Summary report is needed for processing

2. eReporting Other ACH with no Bank Account Activation

   • No activation is required in eReporting
   • Submit payment with Other ACH
   • Signed Summary along with an ACH Memo is required to be sent in together for processing

If you have questions related to the conversion to electronic payment, please reach out to your payroll contact.

BEARS Import File Layout Update

BEARS “Go Live” has been postponed until September 2025. Migration to BEARS is currently scheduled to occur Labor Day Weekend.

The design and development of the Division of Retirement and Benefits’ (Division) new retirement reporting system, the "BEnefits And Retirement System" (BEARS), is nearing completion. However, as we progress through internal testing, it has become clear that additional time is needed for thorough file testing and successful implementation.

Developing a new retirement and employer reporting system has been a significant undertaking, and we are currently in the user testing phase of BEARS. Unfortunately, this testing is taking longer than initially expected. To ensure that all employers can report accurately in the new system, we are testing each employer's personnel and payroll file layouts individually. To facilitate this process, it is crucial that you submit your file layouts to the Division as soon as possible.

During the file layout testing process, employers have submitted a number of questions, which the BEARS Communication team is actively addressing. To keep everyone informed, the Division will compile these questions and provide answers in a Frequently Asked Questions (FAQ) section on the Employer FAQ page of our website. You can access the page at drb.alaska.gov/help/faqs.html#employer. As additional questions arise, we will continue to update the page with new responses.

We appreciate your cooperation and patience as we work to ensure a smooth transition to BEARS for all employers.

In the meantime, a brief listing of common errors that have occurred during testing are shown below:

• The row headings must contain leading zeros (01, 02, 03, 04 – not 1,2,3,4)
• There cannot be any text or heading before record type 01.
• Must use defined BEARS codes
  
  Examples:

• The layout requires the exact number of columns for each row. If there are too few columns or too many columns, the layout will fail to import.  

Personnel File

Record Type Header: 01 must have 3 columns (commas entered for any blank columns)
Record Type Header: 02 must have 35 columns (commas entered for any blank columns)
Record Type Header: 03 must have 22 columns (commas entered for any blank columns)
Record Type Header: 04 must have 7 columns (commas entered for any blank columns)

Payroll File

Record Type Header: 01 must have 5 columns (commas entered for any blank columns)
Record Type Header: 02 must have 12 columns (commas entered for any blank columns)
Record Type Header: 03 must have 12 columns (commas entered for any blank columns)

As noted in our initial letter, the Division will need Employers who plan to submit files through the portal to create the following files in a .csv format for import into the BEARS Employer Self-Service (ESS) portal: 

1. Personnel File: The personnel file is a “changes only” file and will contain all demographic data (employee name, address, DOB, marital status, etc.) and employment events (HIRE, TERM, LWP, TSE, STAT, etc.)
   
   
2. Payroll File: The payroll file will contain earnings and contributions for each active employee and any adjustments being submitted.

Employers who plan to manually input or clone their personnel or payroll data as they do today should review the file layouts as there are changes to how data will be reported in BEARS.

Once you have the personnel and payroll file layouts ready for testing, please email our BEARS communication platform at drb.bears.communication@alaska.gov. A Division representative will provide you a link to securely upload the files to the Alaska ZendTo portal.  Upon receipt of your .csv files, the Division will import your file into the ESS portal to ensure there are no errors in your file layout, and will be providing feedback if there are any errors noted.

Thank you for participating in our testing. Please reach out to us with any questions or issues you may have at drb.bears.communication@alaska.gov. We value and appreciate your feedback and questions which will be used to create an employer manual.

IRS Pension Plan Limitations for Calendar Year 2025

The IRS has announced the calendar year 2025 pension plan limitations.  The pension plan limitations that specifically apply to the pension contributions submitted to the Division include:

401(a)(17) Compensation Limit

• For calendar year 2025, the compensation limit is increasing to $350,000.
• The compensation limit is the maximum amount of compensation that employee contributions are allowed to be submitted.
• Gross earnings and Employer contributions are still due to the Division if an employee’s compensation exceeds the limit.

457 Deferred Compensation Limits

• For calendar year 2025, the DCP maximum contribution limit is $23,500.
• Catch up Age 50 -59 or Age 64 and over: Participants are allowed to contribute an additional $7,500 between the age of 50-59 or age 64 and over for an annual maximum of $31,000. This represents the annual allowable of $23,500, plus the additional $7,500.
• Catch-up Age 60-63 are allowed to contribute an additional $11,250 for an annual maximum contribution of $34,750. This is a new IRS provision starting in calendar year 2025.
• Special 457 Catch-up (Three Year Provision) contribution limit is $47,000. This represents double the annual maximum of $23,500.

On November 1, 2024, the Internal Revenue Service issued Notice 2024-80 to announce the 2025 dollar limit.

SBS Limitation for Calendar Year 2025

The Social Security Administration has announced the calendar year 2025 base wage is increasing to $176,100 (Social Security Contribution Base). The SBS base wage mirrors the social security limits. 

If you have any questions regarding the IRS Pension Limitations especially if you have an employee who appears will meet or exceed the limitations, please reach out to your payroll contact.