FAQ - Tax-Deferred Annuity (TDA)

1. What are the 2008 tax-deferral limits ?
   
   Employees under age 50 in 2008 may tax-defer $15,500.
   Employees age 50 or over in 2008 may tax-defer $20,500.
   Employees with 15 or more years of service may be eligible to tax-defer an additional $3,000 if they have not made maximum contributions in previous years (contact your state-authorized investment carrier for more information).
   
   
2. What is the maximum amount an employee can tax-defer in 2008 if they make an additional voluntary contribution (IRC 403-b) and participate in the NJ Deferred Compensation plan (IRC 457)?
   
   Please refer to the chart below:
   
   

   Plan	Under Age 50	Age 50 and Older
   403(b)	$15,500	$20,500
   457	$15,500	$20,500
   	$31,000 (less than 15 years of service at Rutgers)	$41,000 (less than 15 years of service at Rutgers)
   403(b) catch-up (at least 15 years of service at Rutgers)	+  3,000 (catch-up)	+  3,000 (catch-up)
   	$ 34,000	$ 44,000

   
   
3. What is the deadline for changing my contribution amount to affect the first pay period of 2008?
   
   The deadline is December 18, 2007, for online submission. The paper filing deadline is December 3, 2007.
   
   
4. If I miss the January 1 deadline, can I still change my contribution amount later?
   
   Yes. You can change your contribution at any time. If you are using the online system, you will see the date that your Salary Reduction Agreement will take effect and the percentage contribution required to reach your 2008 maximum TDA limit.
   
   
5. My current 2007 tax-deferral contribution percentage is higher than the 2008 contribution percentage required to reach the 2008 maximum limit. Should I change my contribution?
   
   Yes, if you would like to distribute your contributions over the entire calendar year. If you do not make any changes, you are likely to reach your maximum limit before the last pay period of 2008.
   
   
6. Can I submit a paper form to change my tax-deferral contribution amount or investment carrier?
   
   Yes, you can access the Carrier Allocation/Salary Reduction Agreement form online. Send your completed form to: Payroll Services, 65 Davidson Road, ASB, Room 317, Busch Campus.
   
   
7. I have never made a voluntary 403(b) contribution. How do I start?
   
   1. Contact a state-authorized investment carrier to obtain the carrier’s enrollment application. Carriers are listed on the back of the Carrier Allocation/Salary Reduction Agreement form.
   
   2. Complete the carrier’s enrollment application and return it directly to the carrier.
   
   3. Complete the Carrier Allocation/Salary Reduction Agreement form. On the top section of the form, indicate either ACTS or ABP (depending on your retirement plan) and check the box for new enrollment. Designate your investment carrier(s) and allocation percentage. On the lower portion of the form, indicate the voluntary percentage you would like to contribute.
   
   4. Send a copy of your completed carrier enrollment application (send the original to the carrier) with the Carrier Allocation/Salary Reduction Agreement form to: Payroll Services, 65 Davidson Road, ASB, Room 317, Busch Campus.
   
   
8. How can I change my investment carrier?
   
   1. Contact a state-authorized investment carrier to obtain the carrier's enrollment application. Carriers are listed on the back of the Carrier Allocation/Salary Reduction Agreement form.
   
   2. Complete the carrier’s enrollment application and return it directly to the carrier. Send a copy of your completed carrier enrollment application to: Payroll Services, 65 Davidson Road, ASB, Room 317, Busch Campus.
   
   3. If you have your new carrier’s contract number, you can change your carrier online or complete the carrier allocation section of the Carrier Allocation/Salary Reduction Agreement form and return the form to: Payroll Services, 65 Davidson Road, ASB, Room 317, Busch Campus.
   
   
9. Are there other plans available to Rutgers employees in addition to a 403(b) plan?
   
   Yes, as a Rutgers employee, you can also participate in the New Jersey State Employees Deferred Compensation Plan. Through this plan, you can contribute an additional $15,500 in 2008 if you are under the age of 50 (for a total of $31,000 using both plans), or an additional $20,500 if you are age 50 or older (for a total of $41,000 using both plans). The Deferred Compensation plan is an IRC 457 plan administered by Prudential Financial and offers a broad array of investment options. For more information, visit Prudential’s Deferred Compensation website or contact Prudential at 866-657-3327.
   
   
10. If I reach my maximum limit before the end of the year, will Payroll stop future deductions?
    
    Yes, Payroll has a procedure in place to stop future deductions in order to prevent employees from exceeding maximum tax-deferral limits. When this occurs, the employee will receive a notification letter from University Human Resources.
    
    
11. The online system allows me to make changes for 2008. Can I still make changes for 2007?
    
    Yes, for assistance please contact a Benefits Specialist at 732-932-3020, ext. 4077 or email the benefits team.

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Last Updated: 10/31/2007