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.

T

tax-exempt income

Income that is not subject to federal or state taxation.

tax-sheltered

TRS contributions and optional service purchases that are paid with pre-tax dollars and are not subject to current year income taxes. Examples include TRS member contributions deducted from member paychecks, TRS member contributions paid by the employers, and amounts paid to TRS under the Payroll Deduction Program. Tax-sheltered dollars are subject to income taxes over the expected duration of a TRS retirement annuity.

taxable income

Income that is subject to federal or state taxation. Taxable income can be ordinary income, capital gains, or both.

TCHP, Teachers’ Choice Health Plan

A traditional medical indemnity plan offered within the Teachers’ Retirement Insurance Program.

THIS Fund, Teachers’ Health Insurance Security Fund

All active TRS members, except employees of state agencies, are required to make contributions to the THIS Fund to help finance the Teachers’ Retirement Insurance Program. These contributions are at the rate of 0.80 percent (0.75 percent prior to July 1, 2005) of creditable earnings and are nonrefundable. Effective January 1, 2002, all school districts are required to make a contribution of 0.5 percent of active teacher salaries (0.4 percent prior to July 1, 2003). Effective July 1, 2005, the THIS Fund contribution rate will increase to 0.80 percent for members and 0.60 percent for employers for 2005-2006 school year earnings.

Topics & Report

Produced three times each year, this newsletter contains articles and features of interest to members, annuitants, and beneficiaries.

total normal cost

An amount, usually expressed as a percentage of pay, that is necessary to fund the pension benefits earned during a particular year. TRS’ actuary determines the percentage each year.

total number of days paid

The total number of days paid, Monday through Friday, during the school year for which a member performed duties requiring certification. The total number of days paid is used to calculate service credit.

TRS employer number or TRS code

A numerical code assigned by TRS to identify each specific TRS-covered employer. The format of the TRS code is XXX-XXXX with the first three numbers signifying the numerical code assigned to the county in which the employer is located and the final four numbers signifying the school district number for regular school districts.

TRS and THIS Fund Remittance forms

Documents provided by TRS to each TRS employer on a monthly basis as a part of the comprehensive statement and bill package. The forms are used by employers when remitting payments for billed amounts.

TRS-covered employer

The statutorily defined school district or other entity that employs individuals who meet TRS membership requirements. The employer is the fiscal agent responsible for reporting salary and service information and remitting appropriate contributions to TRS for qualifying members.

TRIP, Teachers’ Retirement Insurance Program

A partially subsidized health and prescription drug insurance program in which qualifying TRS benefit recipients may elect to enroll. The program is administered by the Illinois Department of Healthcare and Family Services (HFS).

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