Payroll Services

Salary Spread

Employees with a nine-month basis appointment may be eligible to elect salary spread so that payments are received in the summer. Once salary spread has been elected, the arrangement is irrevocable for the remainder of the fiscal year. It will remain in effect for all future fiscal years until a cancellation request is sent to Payroll Services or until the employee becomes ineligible.

To be eligible for salary spread, the employee must be appointed in a faculty title, or researcher in combination with a faculty title, and may not be a State of Texas retiree. In addition, appointments (both faculty and research) must have a nine-month basis, end before June (i.e., not a summer appointment), and cannot be paid from a 26 account number (i.e., grant account). Employees that are paid from grant accounts will not receive equal payments during the course of the 12-month pay period.

Employees who meet all the criteria may elect salary spread by completing and sending in the Salary Spread Request Form to Payroll Services. This form must be received no later than Aug. 31, for an employee appointed for the fall semester and Jan. 15, for a new employee appointed for the first time in the spring semester.

In July 2008, the IRS issued regulations limiting the salary amount that can be deferred from the September through December pay periods to the next tax year. The amount is subject to the applicable annual deferral limit established under Section 402(g)(1)(B) of the Internal Revenue Code of 1986. For 2009, this limit is $16,500. Once this limit is reached during the fall semester, all further salary deferral will stop until the next calendar year. As a result, individuals who reach the limit may notice a fluctuation in pay during the course of the 12 month pay period.

In the event of a change in status to an employee's appointment that causes it to no longer meet the requirements stated above, a full settlement of all reserved amounts will be paid to the employee. The salary spread will be reinstated for future appointments when they are compliant. Other changes in status that will result in the cancellation of salary spread and a settlement of reserved amounts include separation, retirement, or death.

Benefits eligible employees who elect salary spread and participate in either the Teacher Retirement System or the Optional Retirement Program will make a retirement contribution from each of the 12 payroll checks. Employees who participate in the UTSaver TSA 403(b) or DCP 457(b) programs have the option to make contributions on a 9- or 12-month basis. Benefits eligible employees enrolled in insurance coverage who elect salary spread will have insurance premium deductions and premium sharing additions on each of the 12 payroll checks. For questions regarding your UTSaver participation or insurance coverage, please contact the Human Resource Service Center (HRSC) by e-mail at HRSC@austin.utexas.edu or by phone at 512-471-4772.

Requests for the cancellation of salary spread will go into effect the next fiscal year, beginning Sept. 1.