How to Complete the OPERS Withdrawal Form: Eligibility, Taxes, and Payout

To file an OPERS refund application, log in to your account at opers.org, complete the refund request online, and wait for OPERS to release the money — which cannot happen until two full calendar months have passed since your last day of public employment. Once the waiting period ends and OPERS has your application, your former employer’s separation certification, and spousal consent if it applies, processing typically takes 15 to 20 business days.¹ Before you file, understand the trade: taking the refund permanently cancels every year of service credit you have built and ends your eligibility for retirement, disability, and survivor benefits through OPERS.²

What a Refund Actually Costs You

A refund is not a partial withdrawal or a loan against your account. Ohio Revised Code Section 145.40 states that payment of your accumulated contributions cancels your total service credit in the system.² Every year of credit you had disappears the moment the refund is paid.

If you are in the Traditional Pension Plan or Combined Plan, leaving your account on deposit instead preserves your eligibility for a future monthly pension, disability benefits, and survivor benefits for your family. Member-Directed Plan participants do not have disability or survivor coverage through OPERS regardless of what they do with the account.³ Once the refund is paid, those protections are gone.

If you later return to Ohio public employment, you start over as a new member with zero credit. Buying back the prior credit is sometimes possible, but it typically costs significantly more than the refund because interest accrues on the repayment. If there is any realistic chance you will return to public service, look into that math before filing.

Who Can Apply

You qualify for a refund only after you have completely ended all public employment covered by OPERS, including part-time, seasonal, and temporary positions. Nothing gets paid out while you remain on any OPERS-covered payroll.²

Two full calendar months must pass after your last day before OPERS can release funds. The waiting period gives your former employer time to submit final payroll reports and contribution records. If you return to any OPERS-covered job during those two months, the application becomes invalid and you stay in the system.² You also cannot be under a contract for future public employment in Ohio when you file.

What You Receive

A refund returns 100 percent of the member contributions deducted from your paychecks, currently 10 percent of your earnable salary for each pay period you worked.⁴ The 14 percent your employer contributed on your behalf stays with the retirement system and is not part of the refund.⁵

Members with at least five years of service credit are eligible for an additional amount on top of their accumulated contributions, drawn from the employers’ accumulation fund. The exact amount is set by OPERS board rules and scales with the credit you have earned.⁶ If you are near the five-year mark, confirm your total service credit before filing. A few extra months of credit could make a meaningful difference in the payout.

How to Submit the Application

OPERS processes refund applications through the member’s online account at opers.org. Log in, go to the refund section, and follow the prompts. The online form pre-fills demographic information already on file and lets you track status after submission.⁷

Members who participated in an Alternative Retirement Plan cannot use the online application and must contact OPERS directly for the correct form.⁷ Paper forms can be mailed to OPERS at 277 East Town Street, Columbus, Ohio 43215-4642, or faxed to 614-857-1152.

Your former employer must certify your separation from service before OPERS can process anything. That certification is what starts the two-month clock, so it is worth calling your former HR office to confirm the final payroll report has been filed. If it has not, your application will sit.

Information to Have Ready

Before you start the application, gather:

Your Social Security number and OPERS ID, both used to verify your account.
Current mailing address and contact information, since OPERS sends notices and tax documents to the address on file.
Bank routing and account numbers for direct deposit or to identify the receiving institution for a rollover. The nine-digit routing number and account number are on the bottom of a personal check.
Your last day of public employment, which must match what your employer reports.
Rollover destination details if you are rolling over to an IRA or another employer plan: the receiving institution’s name, address, and account number.

Check every digit before submitting. A transposed number in a routing or account field can hold up your payment for weeks while OPERS untangles the failed transfer.

Spousal Consent

If you are legally married and eligible for a monthly retirement benefit when you file, OPERS requires your spouse’s written consent before releasing the refund. The spousal consent form is provided as part of the application.³ The rule exists because a lump-sum refund eliminates the survivor annuity your spouse would otherwise be entitled to. If this applies to you and you skip it, the application will not move.

Taxes, Rollovers, and the Early Withdrawal Penalty

How you take the money determines what the IRS grabs immediately. You have two options.

Direct Rollover

OPERS sends your refund straight to another eligible retirement account: a traditional IRA, Roth IRA, 401(k), 403(b), or governmental 457(b) plan. No federal income tax is withheld, and the money keeps growing tax-deferred. After-tax contributions can be rolled to an employer plan only through a direct rollover, and only if the receiving plan tracks after-tax money separately.⁸

Cash Distribution

If the refund is paid directly to you, OPERS must withhold 20 percent of the taxable portion for federal income taxes. That withholding is a prepayment toward what you owe at tax time, not a penalty.⁸

You still have 60 days after receiving a cash distribution to move the money into an IRA or employer plan and avoid current tax on it. The problem is that the 20 percent already withheld stays with the IRS until you file, so rolling over the full balance means covering that 20 percent from other funds.⁸

The 10 Percent Early Withdrawal Penalty

On top of income tax, distributions taken before age 59½ generally trigger an additional 10 percent federal tax penalty. Several exceptions matter for OPERS members:⁹

If you separated from public employment during or after the year you turned 55, the penalty does not apply to distributions from governmental defined benefit or defined contribution plans.
Qualified public safety employees, including law enforcement officers, corrections officers, and firefighters, get the separation exception starting at age 50.
Distributions from a governmental 457(b) plan avoid the 10 percent tax at any age, except for portions rolled in from a different plan type.
Distributions due to total and permanent disability, made after the participant’s death, or paid to an alternate payee under a qualified domestic relations order are exempt.
IRS levies, qualified military reservist distributions, qualified birth or adoption expenses up to $5,000 per child, terminal illness, and certain disaster recovery distributions up to $22,000 can also avoid the penalty.

The cleanest way to sidestep the penalty entirely is a direct rollover into an IRA or another qualified plan. A rollover is not treated as a distribution, so no penalty applies.⁹

When You Will Get Paid

The two-month clock starts on your last day of OPERS-covered employment as certified by your employer, not on the date you submit the application.² You can file during the waiting period, but nothing pays out until the two months are up.

Once the waiting period ends and OPERS has your application, the employer’s separation certification, and spousal consent if it applies, processing takes roughly 15 to 20 business days.¹ The most common delay is a missing employer report. If your former agency has not filed its final payroll certification, everything waits.

Direct deposits arrive in your bank account at the end of processing. For rollovers, OPERS mails a check payable to the receiving institution. You will get notice when the refund is approved and scheduled, and a 1099-R tax form the following January covering the year of the distribution.

Differences by OPERS Plan

The three OPERS retirement plans handle refunds a little differently.

Traditional Pension Plan: Your refund is your accumulated member contributions plus any additional amount under Section 145.401 if you have at least five years of service.
Combined Plan: You receive your member contributions from the defined-benefit side plus the balance in your individual investment account. OPERS cannot guarantee the exact date the investment account will be liquidated, and unforeseen delays can occur.¹⁰
Member-Directed Plan: Your refund is the full balance of your individual investment account. Members seeking a full distribution must use the online refund application rather than a retirement application form.¹¹

The same two-month waiting period and eligibility rules under Section 145.40 apply regardless of plan. The tax withholding and rollover options work the same way across all three.

Leaving the Account on Deposit Instead

The refund is irreversible, so it is worth knowing what happens if you do nothing. Leaving your contributions on deposit after ending public employment preserves your service credit and keeps you eligible for a future monthly retirement benefit, disability coverage, and survivor benefits.³ OPERS continues to manage the account even though no new contributions are coming in.

For someone with several years of public service who might return, leaving the money in place is often the stronger choice. A monthly pension earned over enough years will almost certainly exceed the lump-sum refund over time. If you have only a year or two of contributions and no plans to return to Ohio public employment, the math may favor taking the refund and rolling it into a retirement account you control.

1
OPERS. Answers to OPERS Member Questions
2
Ohio Legislative Service Commission. Ohio Revised Code 145.40 – Payment to Member Who Ceases to Be a Public Employee
3
OPERS. OPERS Member Handbook
4
OPERS. OPERS Employers – General Information
5
OPERS. What Is OPERS – The Importance of Your OPERS Membership
6
Ohio Legislative Service Commission. Ohio Revised Code 145.401
7
OPERS. Refunding Your OPERS Account
8
OPERS. Special Tax Notice Regarding OPERS Payments
9
Internal Revenue Service. Retirement Topics – Exceptions to Tax on Early Distributions
10
OPERS. Combined Plan – Refunding from the Combined Plan
11
OPERS. OPERS Member-Directed Plan Retirement Application