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Opting out of Social Security

Guest wjr

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I have received conflicting information reagrding a Governmental organization being able to Opt-out of Social Security. One told me that no one is able to opt-out anymore except for possible seasonal/part-time employees. The other said it could be done provided they never had filed a 218 Agreement to remain in Soc. Sec.

Can anyone help clarify this for me. Thanks

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Whether they can opt out depends on how they ended up in Social Security in the first place. If they got in due to a Section 218 agreement, they cannot now opt out. However, even in the absence of a Section 218 agreement, a state or local government is now required to cover under Social Security any employee who is not covered by a retirement system that meets certain regulatory requirements. Because that test is performed on an employee-by-employee basis, a governmental entity that is not covered by a Section 218 agreement can in effect opt out of Social Security by covering its employees under a plan that meets the requirements.

For more information, you can view the regulation by clicking here.

Employee benefits legal resource site

The opinions of my postings are my own and do not necessarily represent my law firm's position, strategies, or opinions. The contents of my postings are offered for informational purposes only and should not be construed as legal advice. A visit to this board or an exchange of information through this board does not create an attorney-client relationship. You should consult directly with an attorney for individual advice regarding your particular situation. I am not your lawyer under any circumstances.

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You will need to do some research. Start with this thread :


I should have some info, when I find it I will let you know. My best recollection is that it can be done for all employees of eligible employers and I know of a number of states, hospitals, colleges and community colleges that have such plans for all employees and a few that have it for only seasonal and part-time.

George D. Burns

Cost Reduction Strategies

Burns and Associates, Inc

www.costreductionstrategies.com(under construction)

www.employeebenefitsstrategies.com(under construction)

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Guest Ralph Amadio

A great deal depends on your state's relationship with Social Security. Divided systems are allowed in several states, which means that Carol is correct, in that agencies that have elected to participate through a 218 agreement may (since 1983)not leave Social Security. On the other hand, if a new agency is formed, based on state law allowing it in a Divided system state, that new agency may elect NOT to participate.

My practice has been involved in establishing approximately a dozen new government agencies in the past two years, some of them combined agencies with several participating members. The advantages are quite substantial. If you wish further information, contact me at info@publicagencyretirement.com

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