Qualifying Compensation


For purposes of STRS Ohio retirement contributions, compensation is defined in Section 3307:01, R.C. as all salary, wages and other earnings, including compensation paid in accordance with supplemental contracts. These amounts are subject to contributions regardless of whether they are treated as deferred income for federal income tax purposes.


STRS Ohio members contribute a percentage of earned compensation to STRS Ohio for teaching services, including supplemental and summer earnings. This includes retirees of Ohio public retirement systems who are employed in STRS Ohio-covered positions. Employers must withhold the correct contribution amounts from salary payments and remit contributions to STRS Ohio within five business days after each pay date. View contribution rates.

If a benefit cafeteria plan is available from the employer and a member elects to receive a reduced salary to receive additional fringe benefits, retirement contributions must be based on the gross salary before the reduction. Cash payments that are in addition to the member’s salary, in lieu of a cafeteria plan, are not subject to retirement contributions.

These types of payments are excluded from compensation for retirement purposes:

  • Payments for accrued but unused sick, vacation or personal leave, including payments for perfect attendance.
  • Vacation pay covering concurrent periods for which other salary or compensation is paid.
  • Amounts paid to provide insurance coverage of any type, and cash payments in lieu of providing insurance coverage, including payments for Medicare.
  • Incidental benefits such as lodging, food, laundry, parking or services furnished by the employer; use of the employer’s property or equipment; or reimbursed job-related expenses such as housing, moving, travel or costs related to professional development.
  • Anything of value that is based on retirement or an agreement to retire, including early contract completion.
  • Payments made by the employer in exchange for a member’s waiver of a right to receive any payment, amount or benefit.
  • Retroactive increases that are not paid in accordance with uniform criteria applicable to all STRS Ohio members who are employed by the employer.
  • Payments for services not actually rendered.
  • Payments that exceed the annual compensation limits for plans qualified under Section 401 of the Internal Revenue Code.

Payments resulting from a grievance or legal settlement may not qualify as compensation. A copy of the grievance or settlement should be forwarded to [email protected] for review prior to remitting contributions.

Tax-Sheltered Annuities

Annuities paid on behalf of a member are considered compensation if the amount is part of the member’s compensation for services and is not excluded for some other reason, such as an annuity in lieu of insurance benefits. Annuity payments should be treated as supplemental compensation, and STRS Ohio contributions must be made for the fiscal year in which annuity payments are earned.

Military Service Pay

By law, Section 5923.05(B), (C) and (E), R.C., STRS Ohio cannot accept retirement contributions on continuing salary payments made by employers to teachers called to active duty. The member may choose to certify this time when he or she returns if eligibility requirements are met.

STRS Ohio should receive retirement contributions on payments required under Section 5923.05 (A)(1) R.C., to public employees who are members of the Ohio organized militia or members of other reserve components of the armed forces of the United States, including the Ohio national guard. The law states that these public employees are entitled to a leave of absence from their respective positions without loss of pay for the time they are performing service in the uniformed services, for periods of up to one month, for each federal fiscal year in which they are performing service in the uniformed services.

Click here to reference Section 5923.05, R.C., which governs payments to Ohio public employees who are called to active military service.

For information about service credit during active military duty, members may call STRS Ohio’s Member Services Center toll-free at 888‑227‑7877.

TPO Service

STRS Ohio members paid for teacher professional organization (TPO) service may qualify to make STRS Ohio contributions on part or all of those earnings. A TPO is an organization of teaching professionals that qualifies as an employee organization under the Revised Code.

The Ohio Administrative Code permits STRS Ohio contributions for TPO service and a member who meets all of the following criteria may be eligible: worked full time or part time for a TPO; received compensation for service to a TPO; and is not eligible for any other retirement benefits, based on the money received for performing such service, except Social Security.

Contributions on payments for local, state or national TPO service can be remitted to STRS Ohio if a member meets the above criteria and the total annual compensation on which contributions are based does not exceed the member’s per diem contract rate for actual teaching service multiplied by 250 days. A member may also contribute on supplemental duties not related to the TPO.

To qualify for contributions, compensation for TPO service must be provided by the collective bargaining agreement between the employer and TPO. Employers must submit a copy of the agreement for STRS Ohio to review.

Employers are required to certify the amount of contributions submitted for TPO service annually. See Annual Reporting for more information on the certification process.