Salt Lake area schools opt out of Social Security
Posted on:5/29/2009
Written By: Chris Robideaux
Website: http://www.socialsecurityexpress.com/
| The new Canyons School District in the Salt lake area may opt out of Social Security, and this has stirred up more questions than answers about the risks and benefits to employees. As the new district considers its options, it will follow a course explored by a handful of Utah municipalities. |
The new Canyons School District in the Salt lake area may opt out of Social Security, and this has stirred up more questions than answers about the risks and benefits to employees. As the new district considers its options, it will follow a course explored by a handful of Utah municipalities. Under federal law, any governmental entity created after 1951 that pays into a "defined retirement plan" such as a 401(k) or state pension is supposed to join or opt out of Social Security by filing a "218 Agreement."
A city, county or school district makes the decision by polling its employees. Opting in is permanent, but agencies that opt out can reverse the decision later, explained Doug Smith, spokesman for Region 8 of Social Security Administration in Denver.
"An entity may enter into a 218 Agreement at any time," Smith said.
As a newly created entity, Canyons, the first new school district in Utah in more than a decade, is exploring its options.
East-side Salt Lake residents conceived Canyons last year when they voted to break away from Jordan School District. The split takes effect July 1, when about 2,500 of Jordan's teachers, principals and classified staff will transfer to Canyons.
Whether Canyons workers vote to opt out of Social Security or not, their decision is bound to affect each worker differently.
More than 50 percent of all retired people depend on Social Security for about half their income.