working-after-retirement

TRS members often ask whether they will be allowed to continue working after retirement.

Retired members may work in positions not covered by the Montana Teachers’ Retirement System without restriction. This could include teaching outside Montana, working in retail, and so on.

However, if a TRS retiree wishes to provide service to a TRS employer in any capacity – even as a volunteer – both the employer and retiree must comply with several requirements.

Internal Revenue Code (IRC) standards prohibit TRS from paying retirement benefits to a member who has not terminated all employment in all positions covered by the retirement system. 

To avoid ambiguity regarding whether the member has actually terminated employment, TRS law requires the retiree to have a break in service of a specified length of time (see §19-20-734, MCA). 

Important: If a newly retired member resumes TRS-reportable employment too soon, it could mean they were never eligible to receive retirement benefits and may be required to repay to TRS all benefits received to date, with interest. 

Can retired members do TRS-reportable work following their break in service?

Yes, so long as they understand and comply with all requirements.

Both the TRS employer and the working retiree must provide written documentation to TRS, and the employer must pay contributions and report the retiree’s earnings to TRS each month.

In addition, nearly all working retirees are subject to an annual earnings limitation. TRS may temporarily reduce or suspend the retiree’s monthly benefit if their earnings exceed the limit.

Important reference materials

For detailed requirements and limited exceptions that may apply, please read the Fact Sheets listed below and all other materials referenced within them.

• Fact Sheet: Terminating Employment and Retiring with TRS
• Fact Sheet: Working After Retirement

Each fiscal year (July 1 - June 30), TRS working retirees may earn up to 49% of their Average Final Compensation (AFC) at retirement or the median AFC (whichever is higher) without any loss or reduction in their monthly TRS retirement benefit. The current limit of 49% is defined in TRS law and is subject to change. (Note: Earnings for disability retirees are tracked on a calendar-year basis.) 

• TIP: If you are a TRS working retiree, you can log into My TRS, the secure member portal, to view your annual earnings limit and keep track of TRS-reportable earnings reported to date. Once you have logged into My TRS, select "My Working Retiree Info" from the menu.