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Retirement

Worcester Regional Retirement
Mandatory Deduction
 
All permanent full-time employees of the Town of Holden must join the Worcester Regional Retirement System.  For purposes of retirement, “full-time” refers to any employee who works 1040 hours in a calendar year.  If an employee is already an active member of any public retirement system in the Commonwealth, their deduction rate for retirement will continue at the same rate, that is, at 5, 7, 8 or 9%.  New employees will have 9% of their regular (non-overtime) pay deducted for retirement.  Some additional types of wages may also be subject to retirement.
 
Employees must complete a retirement enrollment form.  If they are new members of the Worcester Regional Retirement system they must provide a birth certificate, and veterans of the armed services must also provide a copy of their discharge papers. The completed enrollment form and the accompanying documents are forwarded to the Worcester Regional Retirement System.
 
All employee deductions for retirement are sheltered from federal income taxes.  In addition, employees may claim up to $2000 in retirement deductions (Regional Retirement plus Medicare) each year on their state income taxes
30 Plus Retirement:  The Worcester Regional Retirement Board has adopted the 30 Plus ruling, which relates to employees who earn more than $30,000 annually and who are enrolled in the retirement system on or after January 1, 1979.  An additional 2% is deducted from the wages of these employees on all eligible earnings over $30,000.  While the $30,000 figure represents an annual earnings cap, the additional 2% in retirement deductions is calculated based on the employee’s biweekly pay and is withheld every pay period.
 
Medicare
Mandatory Deduction
 

All employees hired by the Town of Holden on or after April 1, 1986 are subject to the Medicare portion of the FICA tax, which is 1.45% of all wages.

Social Security Tax
 

The Town of Holden does not participate in the Social Security portion of the FICA tax.  No Town employee will have Social Security deducted from gross wages.  New employees will be required to sign a form entitled “Statement Concerning Your Employment in a Job Not Covered by Social Security,” acknowledging their understanding that Social Security will not be deducted from their pay and that their employment with the Town of Holden will not count toward the requirements for the collection of a pension from the federal Social Security program. 

OBRA 
Mandatory Deduction for Part Time Employees (19 Hours or Less)
           
Employees who are not eligible to join the Worcester Regional Retirement System are required to enroll in the OBRA Mandatory Alternative Retirement Program.  This program is made available to Town employees through the Commonwealth of Massachusetts, and is administered for the Commonwealth by Empower Retirement (formerly known as Great-West Retirement Services.)
 
Employees who participate in OBRA will have 7.5% of their gross pay deducted for this plan, and these deductions are sheltered from both federal and state taxes.  When OBRA employees leave employment with the Town, they may request a refund of their accumulated deductions from Empower.
 
Voluntary Savings Options
 
 

457 Tax- Deferred Compensation and Roth IRA

Employees can contribute to a 457 Tax-Deferred Compensation Program through Empower Retirement or ICMA/MissionSquare.  Roth IRAs are also now available for employees through Empower Retirement.  Enrolling is easy and can be done online! For enrollment information please contact the Town Manager's Office, 508-210-5501. 

Any changes to Empower contributions do not go into effect until the first of the following month.

Empower Retirement Plan Overview

Empower Website

ICMA/Mission Square Plan Overview

ICMA/Mission Square Website