Publication 571 - Tax-Sheltered Annuity Plans (403(B) Plans) Page 8
Download a blank fillable Publication 571 - Tax-Sheltered Annuity Plans (403(B) Plans) in PDF format just by clicking the "DOWNLOAD PDF" button.
Open the file in any PDF-viewing software. Adobe Reader or any alternative for Windows or MacOS are required to access and complete fillable content.
Complete Publication 571 - Tax-Sheltered Annuity Plans (403(B) Plans) with your personal data - all interactive fields are highlighted in places where you should type, access drop-down lists or select multiple-choice options.
Some fillable PDF-files have the option of saving the completed form that contains your own data for later use or sending it out straight away.
ADVERTISEMENT
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21Status of employer. Your years of service
General Limit
include only periods during which your employer
4.
was a qualified employer. Your plan administra-
tor can tell you whether or not your employer
Under the general limit on elective deferrals, the
was qualified during all your periods of service.
most that can be contributed to your 403(b)
account through a salary reduction agreement is
Service with one employer. Generally, you
Limit on Elective
$16,500 for 2011 and $17,000 for 2012. This
cannot count service for any employer other
limit applies without regard to community prop-
than the one who maintains your 403(b) ac-
erty laws.
count.
Deferrals
Church employee. If you are a church em-
ployee, treat all of your years of service with
15-Year Rule
related church organizations as years of service
The second and final component of MAC is the
with the same employer. For more information
limit on elective deferrals. This is a limit on the
about church employees, see
chapter
5.
If you have at least 15 years of service with an
amount of contributions that can be made to
educational organization (such as a public or
your account through a salary reduction agree-
Self-employed ministers. If you are a
private school), hospital, home health service
ment.
self-employed minister, your years of service
agency, health and welfare service agency,
include full and part years in which you have
A salary reduction agreement is an agree-
church, or convention or association of churches
been treated as employed by a tax-exempt or-
ment between you and your employer allowing
(or associated organization), the limit on elective
ganization that is a qualified employer.
for a portion of your compensation to be directly
deferrals to your 403(b) account is increased by
the least of:
invested in a 403(b) account on your behalf. You
Less than 1 year of total service. Your years
can enter into more than one salary reduction
of service cannot be less than 1 year. If at the
1. $3,000,
agreement during a year.
end of your tax year, you have less than 1 year
2. $15,000, reduced by the sum of:
of service (including service in any previous
More than one 403(b) account. If, for
years), figure your limit on annual additions as if
!
any year, elective deferrals are contrib-
a. The additional pre-tax elective deferrals
you have 1 year.
uted to more than one 403(b) account
made in prior years because of this
CAUTION
for you (whether or not with the same employer),
rule, plus
Total years of service. When figuring prior
you must combine all the elective deferrals to
years of service, figure each year individually
b. The aggregate amount of designated
determine whether the total is more than the limit
and then add the individual years of service to
Roth contributions permitted for prior
for that year.
determine your total years of service.
tax years because of this rule, or
403(b) plan and another retirement plan. If,
Example. The annual work period for
3. $5,000 times the number of your years of
during the year, contributions in the form of elec-
full-time teachers employed by ABC Public
service for the organization, minus the total
tive deferrals are made to other retirement plans
Schools is September through December and
elective deferrals made by your employer
on your behalf, you must combine all of the
February through May. Marsha began working
on your behalf for earlier years.
elective deferrals to determine if they are more
with ABC schools in September 2007. She has
than your limit on elective deferrals. The limit on
If you qualify for the 15-year rule, your elec-
always worked full-time for each annual work
tive deferrals under this limit can be as high as
elective deferrals applies to amounts contrib-
period. At the end of 2011, Marsha had 4.5
$19,500 for 2011 and $20,000 for 2012.
uted to:
years of service with ABC Public Schools, as
To determine whether you have 15 years of
shown in
Table
4-1.
•
401(k) plans, to the extent excluded from
service with your employer, see
Years of Serv-
income,
Table 4-1. Marsha’s Years of
ice, next.
•
Service
Roth contribution program,
Years of Service
•
Note. This table shows how Marsha figures her
Section 501(c)(18) plans, to the extent ex-
years of service, as explained in the
cluded from income,
To determine if you are eligible for the increased
previous example.
•
Savings incentive match plan for employ-
limit on elective deferrals, you will first need to
Portion of
figure your years of service. How you figure your
ees (SIMPLE plans),
Period
Years of
Year
Work
years of service depends on whether you were a
Worked
Service
•
Simplified employee pension (SEP) plans,
Period
full-time or a part-time employee, whether you
and
worked for the full year or only part of the year,
2007
Sept. – Dec.
.5 year
.5 year
•
and whether you have worked for your employer
All 403(b) plans.
Feb. – May
.5 year
for an entire year.
Roth contribution program. Your 403(b)
2008
1 year
You must figure years of service for each
Sept. – Dec.
.5 year
plan may allow you to designate all or a portion
year during which you worked for the employer
of your elective deferrals as Roth contributions.
Feb. – May
.5 year
who is maintaining your 403(b) account.
2009
1 year
Elective deferrals designated as Roth contribu-
Sept. – Dec.
.5 year
If more than one employer maintains a
tions must be maintained in a separate Roth
403(b) account for you in the same year, you
Feb. – May
.5 year
account and are not excludable from your gross
must figure years of service separately for each
2010
1 year
income.
employer.
Sept. – Dec.
.5 year
The maximum amount of contributions al-
Feb. – May
.5 year
lowed under a Roth contribution program is your
2011
1 year
Definition
Sept. – Dec.
.5 year
limit on elective deferrals, less your elective de-
ferrals not designated as Roth contributions. For
Total years of service
4.5 years
Your years of service are the total number of
more information on the Roth contribution pro-
years you have worked for the employer as a
gram, see Publication 560, Retirement Plans for
full-time employee maintaining your 403(b) ac-
Full-time or part-time. To figure your years of
Small Business.
count as of the end of the year.
service, you must analyze each year individually
Excess elective deferrals. If the amount
and determine whether you worked full-time for
contributed is more than the allowable limit, you
the full year or something other than full-time.
Figuring Your Years of Service
must include in your gross income for the year
When determining whether you worked full-time
contributed the excess that is not a Roth contri-
Take the following rules into account when figur-
or something other than full-time, you use your
bution.
ing your years of service.
employer’s annual work period as the standard.
Page 8
Chapter 4 Limit on Elective Deferrals
ADVERTISEMENT
0 votes
Related Articles
Related forms
Related Categories
Parent category: Financial