UF implemented a mandatory Retirement Special Pay Plan on November 29, 2006, to provide maximum tax advantages for salaried employees (non-OPS), and the University, related to eligible vacation and sick leave payments. The Retirement Special Pay Plan is an Internal Revenue Code Section 401(a) plan and has been implemented in partnership with BENCOR, a benefits service company specializing in the design, marketing, and administration of retirement plans. Any employees receiving a leave cash out (vacation and/or sick) of $2,000 or more will be automatically enrolled and invested in the BENCOR Retirement Special Pay Plan. Under this plan, neither the employee nor the employer is required to contribute 6.2% of Social Security (OASDI) taxes or 1.45% of Medicare taxes. Instead, the department is charged a Special Pay Plan (SPP) assessment.

The amount charged to the department is not based on a fixed percentage of the employee's SP Pay. Instead the following guidelines apply:

• If the cash out does not cause the employee to exceed the OASDI max for the calendar year in which the cash out is paid; the percentage charged to the department will be 7.65%.
   
• If the employee has already met the OASDI max for the calendar year in which the cash out is paid; the percentage charged to the department will be 1.45%.
   
• If the cash out causes the employee to exceed the OASDI max for the calendar year in which the cash out is paid, the percentage will be between 1.45% and 7.65%, depending upon how much of the cash out was required for the employee to reach the OASDI max. NOTE: The OASDI max for 2007 is $97,500.
   

Charges before July 1, 2007:

The department is charged a Special Pay Plan assessment in the subsequent month, on the applicable pay out amount in the previous month. This charge appears as a journal entry to account 819001 as shown on the Departmental report below: (In the APPROP ledger group this maps to budgetary account 700000).

The UF_GL_SPP_CHARGE_QUERY can be run to provide the employee level detail behind the assessment. The navigation to run the Query is PeopleSoft -> Financial PeopleTools -> Reporting Tools -> Query -> Query Viewer.

Below is a screen shot of a sample query using the January 2007 (accounting period 7) payroll detail for the assessment which appeared on the February 2007 (accounting period 8) departmental report. The column Sum Payroll Amount and Sum Employee SP Pay is the portion of the leave cash out eligible for the Special Pay Plan. The Sum Employer SP Pay is the amount charged to the department, ($795.13 in this example) and posted on the Departmental report to account 819001.

July1, 2007 to May 31, 2009:

SPP charges are moved from 700000 budget line to 600000 budget line in response to the campus community. This charge now appears as a journal entry to account 819001 as shown on the Departmental report below: In the APPROP ledger group this maps to budgetary account 600000.

As of June 2009:

Charges for SPP moved to the current month. The department is charged a monthly SPP assessment, as of the last day of each month, on the applicable salaries within the same month. This charge appears as a journal entry to account 819001 as shown on the Departmental report below: In the APPROP ledger group this maps to budgetary account 600000.

You will notice there are two entries for SPP, the one dated 06/01/09 is for May salaries and the one dated 06/30/09 is for June. All subsequent SPP charges will be as of the last day of the month for that month.

Additional information about the plan is available at http://hr.ufl.edu/retirement/other/specialpayplan.asp. For any questions about the SPP assessment, please e-mail gahelp@admin.ufl.edu.