Benefit Replacement Pay for State Agencies
(Other Than Institutions of Higher Education)
Maximum Amounts and Calculation

Maximum BRP Amounts

Calculation of BRP (Unleveled)

BRP is calculated by taking FICA wages, less BRP, and multiplying this amount by the factor for the appropriate retirement system. See Special Considerations When Leveling BRP in this policy statement for a chart listing the factors for each retirement system.

Each factor takes into account the amount that would have been paid under the state-paid Social Security plan (5.85 percent of FICA wages), as well as an additional percentage to offset the amount the employee would have to pay as retirement deduction because of the additional wages (BRP).

Changes to the employee retirement deduction, such as those made on Sept. 1, 2009, do not affect the BRP calculation. The retirement percentage in the calculation remains the same as when BRP began (6 percent). The factor also allows the proper amount of BRP to be paid up to the maximum allowed.

Agencies must ensure that an employee does not receive more BRP than he or she is entitled to receive.

BRP and Wages Subject to FICA Tax

Starting with the first payments paid in January, each paycheck that includes salary or wages subject to FICA tax includes BRP until the maximum in BRP for the calendar year is met. This includes lump-sum payments, which are considered FICA wages.

Example:

If an employee has $7,500 in FICA wages paid on Jan. 2 and $7,500 in FICA wages paid on Feb.1, the employee will only receive BRP on the first $1,500 of FICA wages paid on March 1 as, at that time, they will have reached the current calendar year maximum of $16,500 in FICA wages.

Source

Texas Government Code, Sections 606.061(3), 659.121, 659.123, 659.125, 659.126, 659.127, 811.001(7).