Category: Payroll

Annual Return of CalSTRS Excess DB/DBS Employee and Employer Contributions Instructions and Overview
Annually, the California State Teachers’ Retirement System (CalSTRS) looks at all of a member’s reported compensation after the fiscal year is over. Compensation earned by a member that is greater than one year of service credit in the Defined Benefit (DB) Program is moved by CalSTRS to the Defined Benefit Supplement (DBS) Program. This action results in “excess contributions” paid by both the employer and employee because contribution rates for the DB and DBS Programs are different. www.calstrs.com/defined-benefit-supplement-program-faq
Each October, CalSTRS returns excess employee and employer contributions to the County Office for distribution to districts and their employees. CalSTRS also sends employee adjustment data that the County Office converts for posting into Escape for each district. To see the employee transactions posted for your district and to correct any errors, follow the path and instructions below:
* HR/Payroll – Employment – Additional Contrib/Deduction * Select the “List” Tab and “Open” * Choose the “Employees” Tab to see a listing of the applicable employees with a return of excess contributions. * No further action is necessary for these transactions. * The adjustment batch has been posted as part of the upload process performed by the County. * The adjustments apply to the October Regular payroll. * Select the “Errors” Tab (if no “Errors” Tab appears, there are no errors to review). * If there are employees listed in the Errors Tab it is mostly likely because the employees are no longer active in Escape. * Adjustments for this group of employees must be manually input by the district. Input data as deduction adjustments using Deduction I.D. “STRSECEE” to return the taxable income to the applicable employees. * For assistance on inputting these adjustments, please contact Sheng Xiong sxiong@sbceo.org<mailto:sxiong@sbceo.org>.
Employee deduction adjustments use monies held in the STRS Employee Trust Fund (9980) for the return of contributions.
* If your district would like a listing of the applicable employees in an Excel file, please contact Sheng Xiong at sxiong@sbceo.org<mailto:sxiong@sbceo.org>.
Employer contributions are transferred from the STRS Employer Trust Fund (9983) and placed into each district’s general fund as a lump sum.
Return of excess deductions/contributions
* See attached 2022-23 Totals – All Districts.pdf for a list of each applicable district and their respective employee and employer excess contribution refund amounts. * Refer to Journal Entry CT 24-00450 dated 10/25/2023 for Escape districts. * The account coding is 01-0000-0-0000-0000-8699-000-0000-ADJS.
* For non-Escape districts, please refer to Journal Entry CT 24-00449 dated 10/25/2023.
For questions about the return of CalSTRS excess contributions, please contact:
Sheng Xiong sxiong@sbceo.org<mailto:sxiong@sbceo.org> Myron Porter mporter@sbceo.org<mailto:mporter@sbceo.org> CalSTRS Contributions@CalSTRS.com<mailto:Contributions@CalSTRS.com>
________________________________ Overview of Excess Employee and Employer Contributions related to the DB and DBS Programs
* Annually, CalSTRS looks at all of a member’s reported compensation after the fiscal year is over. Compensation earned by a member that is greater than one year of service credit in the DB Program is moved to the DBS Program. This action results in “excess contributions” paid by both the employer and employee because the contribution rates for the DB and DBS Programs are different. * In September, CalSTRS notifies active members that have excess contributions with an online message of Retirement Progress Report in Special Messages. Members see this information while logged into their myCalSTRS account and may also select Services, then Excess Contributions to see the report. CalSTRS informs retirees with excess contributions by letter. * In October, excess employer and employee contributions for active members are returned to the County Office for distribution to employers. Employers are responsible for returning the contributions to their employees. * After the end of each quarter, any excess contributions accumulated for members who refund, retire, receive a disability benefit, or die are returned to the County Office and transferred to the employer for disbursement. * Interest is not paid on excess contributions as CalSTRS has no legal requirement or authority to pay interest on the return of excess contributions. * Returned pre-tax contributions are taxable income in the year employees receive them regardless of when the contributions were initially paid. * If there is an adjustment that reduces a member’s excess service credit from a prior year, employer or member contributions may be due back to CalSTRS. * January 2, 2001 * Moving of contributions into the DBS Program from the DB Program began. * No adjustments to contributions were necessary because the contribution rates for the DB and DBS programs were the same. * January 1, 2001 to December 31, 2010 * One-fourth of a member’s 8% DB retirement contributions were moved into the DBS program. * January 1, 2011 to present * DBS Program receives contribution funds based on: * Earnings in excess of one year of service credit. * Special limited term payments. * See CalSTRS Employer Information Circular on Creditable Compensation Regulations Effective Jan. 1, 2015 (Volume 30; Issue 5, Dec. 10, 2014). * July 1, 2014 to June 30, 2022 * Contribution rates for the DB and DBS Programs are not the same. * This occurred with the passage of AB 1469, the CalSTRS 2014 Full Funding Plan<www.calstrs.com/plan-funding> (Ctrl + Click to connect to the link to see the plan). * More information on excess contributions can be found on the CalSTRS website. Type in “excess contributions” in the search box. * The attached CalSTRS Welcome to CalSTRS booklet, Welcome to CalSTRS 2023, page 9, provides an explanation of excess contributions to new members.
________________________________
Regards,
School Business Advisory Services Team Santa Barbara County Education Office
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Dear School Business Professionals,
In support of our districts, the SBCEO Team would like to keep you informed of the Fiscal Year-End (June 30) process and how it may impact various aspects of our regular procedures. Please review the following key reminders below:
Fiscal Year-End Calendar
* Please carefully review the Fiscal Year-End Close Calendar posted here<www.sbceo.org/domain/291> on our SBAS website to verify that all your year-end processing deadlines are met.
Year-End Close Manual
* The Fiscal Year-End Close Manual<sbas.sbceo.org/Escape/DistrictFiscalYearEndCloseManual.2023.pdf> is available to assist with the closing process on the Year-end close<www.sbceo.org/domain/293> website.
Accounts Payable (A/P)
* Warrant Cancels and Cancel/Reissues – The last day for warrant cancel requests is June 23rd at 5 p.m. No straight cancels will be processed between June 26th through the closing of your district’s 2022-23 general ledger. Note: Regular cancel/reissue requests will still be processed after this date.
* Next Fiscal Year A/P Processing – Please note that our adjusted Tuesday AP Holiday Schedule begins on June 29 and continues through July 5 (our office will be closed on Tuesday, July 4 in observance of the Independence Day Holiday). Be sure to review your district’s currently posted AP calendar here<www.sbceo.org/domain/239> and the impact the July 4 Holiday will have on your AP submission and delivery schedule. We will be posting the new District AP Calendars for next year by June 30 (an email reminder will be sent when these are posted on the website).
Accounts Receivable (A/R)
* Deposits – Treasury deposits for the current (2022-23) fiscal year are due to our office no later than 8 a.m. on June 28. Any deposits received by our office after that date and time will be posted in the next fiscal year (2023-24).
Note: The County Treasurer’s Office will accept deposits at their locations in Santa Maria and Santa Barbara until 10 a.m. on June 30. If you choose to make a deposit during the June 28-30 window, we advise that you reconfirm with the County Treasurer’s office directly to verify their deposit procedures and cutoff times.
If you have any questions or concerns, please feel free to contact any one of our finance team members for further clarification and/or guidance.
Thank you.
Alejandro Baeza – ext. 5372 Daisy Lazaer – ext. 5295 Chris Rhodes – ext. 5226 Lydia Barcos – ext. 5357 Kaylyn Fierro – ext. 5260
Regards, School Business Advisory Services Team Santa Barbara County Education Office
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Visit our new website: www.sbceo.org/sbas<www.sbceo.org/sbas>
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