Service Purchase

You can increase your benefit, but it comes at a cost. Check with KPERS if it's right for you.

What is Service Credit?

Service credits represent how long a member has worked. Employees automatically earn “participating” credit for the years they work in a KPERS-covered position. Purchasing additional service credit could help you vest your benefit faster, get more at retirement and possibly retire sooner.

Under KPERS, there are several types of service credit that members can purchase to enhance their retirement benefits. Here are the main types:

• Prior Service Credit: This includes time worked for a KPERS-affiliated employer before the employer joined KPERS. Members can purchase this service to count towards their retirement¹.

• Military Service Credit: Members can purchase up to six years of active military service credit. Additionally, Kansas law allows KPERS to grant service credit for active military service at no cost to the member under certain conditions¹.

• Non-Federal Public Employment: This includes service with other public employers, such as out-of-state public employment, Peace Corps, or VISTA service².

• Out-of-State Teaching: Members can purchase service credit for teaching in public schools outside of Kansas².

• Forfeited Service: If a member previously withdrew their KPERS contributions and forfeited their service credit, they can repurchase this service credit³
  
  Don't wait. Purchase costs are based on salary and age. Now is probably the most inexpensive time for you to buy.

How Does the Process Work?

1. Contact KPERS or the SMSD KPERS Designated Agent, Nicole Churchill to see if your past service is eligible.
2. Complete an Application to Purchase Service Credit: KPERS & KP&F 
3. Your designated agent completes the employer part of the form and sends it to KPERS.
4. KPERS calculates your cost and sends you a letter. At this point, you can consider the cost and benefits.
5. To complete the purchase, sign the paperwork, arrange for payment and return both to KPERS.
6. KPERS receives your payment or payroll deduction commitment. We must receive your complete payment on or before your last day on your employer's payroll.
7. KPERS adds service credit to your record after the purchase is completed.
   
   APPLICATION TO PURCHASE SERVICE CREDIT KPERS-67
   APPLICATION TO PURCHASE SERVICE CREDIT NON KPERS-67PS

Federal Tax Requirements on Service Purchases

Only active members may purchase service. Federal law may limit you if you are purchasing service with after-tax money. This limit applies only to after-tax contributions.

• Not on purchases with rollover or payroll deduction
• Annual limit changes each year
• Can cause a delay in completing a lump-sum after-tax purchase
• Most likely to affect high-cost purchases (large number of years or member's age and salary)