The following definitions are provided to help you understand terms we regularly use in our seminars, correspondence, and publications. These definitions are general, not technical, in nature. For detailed definitions, please see the Illinois Pension Code, Article 16.

F
federally-funded earnings

Any portion of a member’s creditable earnings paid from a special trust or federal funds that are administered by the TRS-covered employer. The employer must pay TRS an employer contribution equal to 10.5 percent of such earnings.

FEIN, federal employer identification number

A number assigned to a corporation, a partnership, an estate, or a legal trust.

file number

A number that is used to identify a TRS participant's record.

final average salary

The highest four consecutive years’ salaries during the most recent 10 years of TRS-covered employment are added together. Then this toatl is divided by four. Used in calculating the member’s pension benefit.

fiscal year

For TRS, the period beginning July 1 of one calendar year and ending June 30 of the following calendar year. It is the same as the school year and the TRS retirement plan year.

flexible benefit plan

A TRS-covered employer benefit plan that offers members a choice between insurance and options that qualify as salary under Board Rule 1650.450 (e.g., cash, tax-sheltered annuities under the Internal Revenue Code (IRC), Section 403(b), or qualified deferred compensation plans under Section 457(b) of the IRC). These plans may be add-on (in addition to salary) or salary reduction (subtractions from gross salary) plans. A flexible benefit plan is reportable as creditable earnings.

FMLA, Family and Medical Leave Act

The FMLA (29 USC §2601 et seq.) provides an entitlement of up to 12 weeks of job-protected, unpaid leave during any 12 months for the following reasons: 1) birth and care of the employee’s child or placement for adoption or foster care of a child with the employee; 2) to care for an immediate family member (i.e., spouse, child, parent) who has a serious health condition; or 3) for the employee’s own serious health condition.

formula

The means for determining most TRS retirement benefits. There are two formulas. 

The 2.2 percent flat-rate formula took effect July 1, 1998, and governs service credit earned after that date. Each year accrues at the rate of 2.2 percent. Service under the old formula may be upgraded to the new formula upon payment of a voluntary employee contribution.

The four-step graduated formula governs service credit earned prior to July 1, 1998. It pays the following percentages for each year of service credit.

The maximum percentage of final average salary that may be paid as a formula benefit is 75.

full-time teacher

A teacher employed in a TRS-covered positionfor four or more clock hours per day, five days per week. The teacher has an employment agreement to work a specified period of time, and an annual salary rate can be established for the position.

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