|
The Economic Growth and Tax Relief Reconciliation Act of 2001 ("EGTRRA")
which was signed into law on June 7, 2001 made a number of changes to the laws
affecting qualified plans. Listed below are some of the changes:
- Increase in contribution and benefit limits
- 401 (k), 403 (b), and 457 plans. The annual limitation
on elective deferrals contained in 401 (g) are as follows:
| Year |
Limit |
| 2003 |
$12,000 |
| 2004 |
$13,000 |
| 2005 |
$14,000 |
| 2006 |
$15,000 |
| 2007 |
$15,500 |
| 2008 |
$15,500 (No Change) |
- Catch-up contributions: Individuals who have
attained age 50 before the close of the plan year are permitted
to make additional contributions according to the following:
| Year |
Limit |
| 2003 |
$2,000 ($14,000) |
| 2004 |
$3,000 ($16,000) |
| 2005 |
$4,000 ($18,000) |
| 2006 |
$5,000 |
| 2007 |
$5,000 |
| 2008 |
$5,000 (No Change) |
- You may defer the maximum to a 401(k) or 403(b)
and contribute up to the same maximum with the 457.
- The catch-up limit for 457 plan allows for twice the annual deferral
limit providing you are three years away from retirement and under
the age of 65.
- Changes in deduction limits. Elective deferrals to 401(k),
403(b), and 457 plans will no longer reduce compensation for purposes
of the deduction limitation. Elective deferrals are not subject to the
25% limitation.
- New rollover and direct transfer rules. All distributions from
qualified plans will generally be allowed to be rolled over to any of
the foregoing plans and distributions from IRAs (whether traditional
or conduit) will be allowed to be rolled over to any of these plans.
- Hardship withdrawal suspensions have been reduced from 12 months
to 6 months.
If you have questions or need further information, please e-mail
benefits@musc.edu or call
(843)792-2607. To increase
supplemental deferred compensation contributions, you will want
to complete a salary reduction agreement. This
form is available on-line at www.musc.edu/hrm/forms
or by visiting the MUSC University Office of Human Resources Management,
19 Hagood Avenue, Room 102 between the hours of 8:30a.m. –
5:00 p.m., Monday- Friday.
ALL REQUESTS HAVE TO BE IN WRITING AND SUBMITTED NO LATER
THAN JAN 10TH FOR THE JANUARY PAYROLL DEADLINE.
|
