Answers to OPERS member questions

This month: We address the Social Security COLA, minimum earnable salary

By Michael Pramik, Ohio Public Employees Retirement System

Oct. 30, 2025 – Members and retirees often ask us questions through our social media channels that others could benefit from. Periodically we post these questions and answers in our PERSpective blog.

Q: OPERS is providing a 2.6% COLA next year for retirees subject to the inflation-based adjustment. I just saw that Social Security is giving a 2.8% COLA in 2026. Why aren’t they the same?

A: OPERS and Social Security both base inflation-adjusted COLAs on the CPI-W, the Consumer Price Index for urban workers. However, the times measured are not the same.

According to state law, the annual inflation-based COLA for OPERS retirees reflects the 12-month change in the CPI-W measured at the end of June of the year preceding the adjustment (with a maximum adjustment of 3 percent.) Social Security’s COLA compares the average change in the index during the third quarter (July, August and September) of the current year to that of the prior year. That’s why the Social Security COLA can differ from the OPERS inflation-based COLA.

Q: Each year it seems that OPERS is raising the bar with new modifications to earnable salary. Why does that amount go up every year, and is there a change for 2026?

A: Minimum earnable salary is the amount that OPERS members must earn each month to qualify for full pension service credit, or service credit applicable to health care program eligibility. Your total service credit is a key component of the formula we’ll use to determine your retirement benefit and/or health care eligibility.

When the Ohio General Assembly passed pension legislation in 2012, it tied minimum earnable salary to any legislative pay raise given to township trustees. Thus, whenever township trustees receive a pay raise, the OPERS minimum earnable salary also increases.

The legislature passed a bill in 2018 that established a 1.75% annual increase in the minimum earnable salary from 2020 to 2029.

This year the legislature increased that percentage change to 5% until 2029 for trustee terms that begin after Sept. 30 of this year. That will increase the monthly OPERS minimum earnable salary from $734.07 to $770.77. If OPERS members earn less than that amount, their service is prorated so they earn partial service credit for that reporting period.

To earn a full month of service credit applicable to health care program eligibility, members participating in the Traditional Pension and Combined plans must earn a minimum of $1,000 per reporting month, and partial service credit is not available for health care.

Q: I have been on OPERS disability since 2005. I’m turning 65 soon. Am I required to still pay federal and state taxes on the disability benefit?

A: Generally, OPERS age-and-service retirement benefits are taxable. If a benefit recipient made after-tax contributions to his or her account, a portion of the recipient’s benefit payment can be excluded from federal taxes until this cost has been recovered. This exclusion can apply to some disability recipients after they’ve converted to an OPERS conversion retirement benefit. Please contact OPERS at 800-222-7377 for specific questions about your account, and consult a tax professional for tax advice.

Q: My husband was not yet retired and recently passed away. I am eligible to receive his pension benefit and am considering taking a reduced monthly benefit with a partial lump-sum option payment. Could I “disclaim” this PLOP and have it go to other beneficiaries, such as children?

A: A PLOP cannot be rolled into an account in another individual’s name, and the beneficiary of the PLOP cannot designate other beneficiaries through OPERS to receive the payment. And, while the distribution date of the PLOP cannot be deferred, it can be rolled into another qualified plan such as an IRA that is in your name as primary beneficiary.

Q: I am trying to find my OPERS tax documents. I receive survivor benefits. How do I access the documents I’ll need to file my taxes next year?

A: The 1099-R tax forms are mailed to our benefit recipients no later than Jan. 31, as required by the IRS. You can request a copy by calling us at 800-222-7377, or you can print it out yourself from the document history section of your online account.