Eligible Employers
Educational institutions, churches and §501(c)(3) organizations
Eligible Employees
The Plan must allow all employees except those working less than 20 hours/week to participate
Elective Deferral Limit
The lesser of 100% of the participant’s compensation or $17,000 in 2012
Over Age 50 Catch-Up
$5,500 in 2012 (may not be offered under all employer plans)
Other Catch-Up Available
A catch-up of $3,000 ($15,000 lifetime cap) is permitted with 15 years of service with the current employer. The participant must have averaged less than $5,000 in §403(b) annual contributions over his or her career with the current employer.
This feature is available only to employees of educational institutions,
hospitals, churches, home health agencies and health & welfare agencies
(may not be offered under all employer plans)
Taxation
Roth contributions are tax-free if paid out as qualified distributions (after five years have
elapsed since the first Roth contribution was made and the participant has attained age 59½)
Non-qualified distributions are paid out pro rata return of principal and earnings
Loans1
Participants may take a loan in an amount that is one half of the account value up to $50,000
Loans are an optional plan feature and must be qualified on an employer plan basis
Hardship Distributions
Participants may take distributions if the participant meets
the guidelines established under §401(k) rules (optional plan feature)
In-Service Distributions
Participants may take distributions at the attainment of age 59½ (optional plan feature)
Participants who have attained age 59½ may roll assets held in a traditional §403(b) account into a Roth §403(b) account. A tax liability will be incurred for the taxable
year the assets were removed from the traditional §403(b).
Participants may take distributions from amounts rolled over from other eligible
retirement accounts that have been separately accounted for (optional plan feature)
Exchanges
Participants may exchange accounts
from one approved §403(b) vendor to another approved vendor that maintains Roth accounts (optional plan feature)
Transfers to & from Plan
Participants may transfer accounts from one employer’s §403(b) plan to a new employer’s §403(b) plan if both plans have provisions allowing the transfer and both plans allow Roth contributions (optional plan feature)
Rollovers into Plan
Participants may rollover distributions from other
eligible Roth retirement accounts into the employer’s §403(b) plan (optional plan feature)
Premature Penalty
Applicable on distributions taken prior to age 59½ unless
the participant meets the age 55 exception (retires in year age 55 is attained or later)
Required Minimum Distributions
A participant must begin taking distributions at the later of the attainment of age 70½ or retirement. The first minimum distribution must be taken by April 1st of the year following the year containing this triggering event.
If a Roth §403(b) is rolled into a Roth IRA, minimum distributions may be avoided.