MIP Funding and Features
MIP is jointly funded by contributions from both school employees and their employers. Employees' contributions are made with pre-tax dollars; that is, they don't pay income taxes on the money they pay into the system at the time it's earned. The money grows tax-free during the employee's working life. All withdrawals after age 59 1/2, though, are taxed as ordinary income.
Participation in the MIP is restricted to those who were on the payroll prior to June 30, 2010; based on their hire dates and selections they made at various times in their tenure, they may belong to one of several different variations of the MIP. Two other retirement savings programs are available for those hired on or after July 1, 2010.
Identification of MIP Contributions
An employee's MIP contribution usually will be listed in Box 14 of the W-2, the Federal Wage and Tax Statement. This box is labeled "Other."
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