Q: How do I apply for a Refund of Contributions?
A: To apply for a refund, you must submit the following to LASERS:
- Form 02‐01: Refund of Accumulated Contributions
- A copy of your Social Security card
Q: When will I receive my refund?
A: Most refunds are paid within 60 - 90 days. It is not necessary to contact LASERS regarding the status of your refund.
Q: What are the impacts of taking a refund of contributions?
A: Refunds of contributions automatically cancel all service credit in LASERS. In other words, a refund cancels your membership in the retirement system, and renders you ineligible for benefits. The refund will only be of your contributions, not your employer’s contributions, and will not include interest.
Q: How does a refund of contributions impact my taxes?
A: The amount of contributions sheltered from federal income tax (amounts paid after January 1, 1984) are subject to federal taxes when refunded, unless the sheltered refund amount is rolled over into another qualified retirement plan (such as an IRA). If not rolled over, these funds are subject to a mandatory 20 percent federal withholding tax. You may also be subject to a 10 percent federal early withdrawal penalty. LASERS does not withhold Louisiana taxes on your refund. An IRS tax notice is attached to each refund application. You should read this tax notice carefully before applying for a refund. The tax notice is a summary and should not be taken as tax advice. LASERS encourages you to contact a tax consultant to determine if the provisions are applicable to your specific situation. To accept a rollover you must have established an account at a financial institution prior to the refund distribution. Your financial institution must complete Section 5 of Form 02‐01: Refund of Accumulated Contributions. Your refund of employee contributions will be direct deposited into the bank account indicated in Section 3 of Form 02‐01: Refund of Accumulated Contributions. Your IRS Form 1099-R will be mailed in January of the following year to your address on file with LASERS.