Receiving Your Benefit and the COLA
Your disability retirement benefit will be deposited to the financial institution account you designate on the Authorization for Direct Deposit of Monthly Benefit (VRS-57). You will begin receiving cost-of-living adjustments (COLAs) effective July 1 following one full calendar year (January 1 to December 31) from your retirement date.
Your benefit will be subject to federal income taxes and, if you live in Virginia, state income taxes, unless you retire on work-related disability with the guaranteed benefit. If taxes are being withheld from your benefit, you will receive a 1099-R form from VRS each January for the previous calendar year's benefit payments and tax withholdings. You will file this form with your federal and state income tax returns.
Group Life Insurance Coverage
If you are covered under the VRS Group Life Insurance Program, some basic group life insurance benefits will continue after you retire on disability. Your coverage begins to reduce on January 1 following one calendar year from your normal retirement age under your plan. The reduction rate is 25% each January 1 until it reaches 25% of the total life insurance benefit value at retirement.
If you are enrolled in the Optional Group Life Insurance Program and meet the qualifications for retirement, you may continue a portion of your coverage upon leaving employment. You as well as your spouse and dependent children, if enrolled, must have been continuously covered during the 60 months preceding your disability retirement.
For more information, contact Securian Financial, the insurer for the VRS Group Life Insurance Program, at 800-441-2258.
Health Insurance Credit
The health insurance credit is a tax-free benefit that assists with health insurance premiums you pay for single coverage, excluding any portion of the premiums covering a spouse or dependents. The credit cannot exceed the amount of your monthly premiums.
If requested by VRS, you will be required to provide updated medical information until your normal retirement age under your plan if you retire on disability. If you refuse to provide updated information, your benefits will stop until you comply. If you refuse to comply for six months following a request for reexamination or if VRS determines you are no longer disabled, your benefits will end.
Working After Disability Retirement
If you take a position with any employer, including a VRS-participating employer, that requires the same or similar duties as those you performed before retiring on disability, your disability retirement benefits will end.
If you return to VRS-covered employment , your disability retirement benefits will end and you will become an active member . You will receive service credit for the period you were on disability retirement.
Retiring Again. You will be required to retire under service retirement when you retire again. If you wish to retire on disability, you must reapply by submitting all required disability retirement forms and documents. Your application will be evaluated under the medical review process based on the duties of your new position.
If you are considering employment after you retire on disability, contact VRS toll-free at 888-827-3847 to determine whether the position would disqualify you from continuing to receive your disability retirement benefits. Also, contact the Social Security Administration toll-free at 800-772-1213 or visit the Social Security Administration website for information on the effect of earnings during retirement on your eligibility for Social Security benefits.