Superannuation retirees working in the public sector in Massachusetts (state, county, municipal, city, town, district or authority) are limited to how much they can earn and how many hours they can work in a calendar year. If you are receiving a public pension or retirement allowance you can work up to 960 hours per year and earn the difference between the current salary of the position you retired from and your pension. After you have been retired a full calendar year (January - December), you can earn an additional $15,000 per calendar year. It is your responsibility to inform your employer that you are receiving a pension. You are also responsible for monitoring the hours you work and your earnings.
This limitation does not apply to survivor benefits.
This limitation also does not apply if you are a superannuation retiree working in the private sector.
Disability retirees have additional limitations and reporting requirements.
Other options available to public pension retirees:
- Stop taking your pension. You may temporarily stop your pension while you are working and start it again once you stop working. You would not receive any additional benefits from your work after retirement.
- Get reinstated under section 105. If you would like to increase your retirement benefit due to additional service you can repay the benefits you have received while in retirement (plus buyback interest) either in a lump sum or a repayment agreement with your retirement board. You would need to work an additional five years full-time before your retirement system can calculate a new retirement benefit for you. If you do not work an additional five years, you would receive a refund of your repayment and you would receive your original retirement benefit without any additional service factored in. You should carefully consider the requirements of this section before making any repayment agreements.
Example of Earnings Limit Calculation:
Joe retired from his position as an accountant in July and is receiving a pension of $30,000 a year.
Joe goes back to work part-time for the town manager after retirement.
The current salary of the position Joe retired from is $50,000 per year.
Until December of the calendar year following his retirement, Joe can earn:
$50,000 - $30,000 = $20,000 per year and can work up to 960 hours per year, whichever comes first
The year after that, because he has been retired a full calendar year, Joe can earn:
$50,000 - $30,000 + $15,000 = $35,000 per year and can work up to 960 hours, whichever comes first
Joe likes working part-time and continues to work a few years into retirement. Due to Cost of Living Adjustments, Joe's pension is now $30,500 and the current salary of the position he retired from is $52,000. Joe stopped monitoring his time and took home $42,000 this year. However, he can only earn:
$52,000 - $30,500 + $15,000 = $36,500 per year or up to 960 hours per year, whichever comes first
$42,000 - $36,500 = $5,500 in excess earnings which Joe must now pay back
Working After Retirement Frequently Asked Questions
Working in Retirement as a Disability Retiree
G.L. c. 32, § 91A - Adjusted Pension or Retirement Allowances
All disability retirees, including those retired under accidental disability, are required by law (M.G.L. c. 32, § 91A) to submit an statement of their earnings. PERAC mails disability retirees an Annual Statement of Earned Income every January which they must complete on or before April 15th of each year.
All pertinent W-2 forms, 1099 forms, other requested tax forms and proof of income, and any other documentation requested by PERAC must be included with the statement.