403 B Universal Update

Except as otherwise selected below, all employees are immediately eligible to make contributions under the Plan. The plan does not include employees who normally work fewer than 20 hours per week (must be 20 or less; equivalent to 1,000 hours or less in a year except as otherwise provided under applicable 403(b) regulations generally effective January 1, 2019) during the calendar year.

Annual contributions to the Plan are limited per IRS regulations and are subject to cost of living increase annually.

The contribution limits for the 2022 calendar year is:
 

For employees with at least 15 years of service with the District, his or her 403(b) elective deferral limit is increased by the lesser of $3,000, $15,000 (reduced by the amount of additional elective deferrals made in prior years because of this rule), or $5,000 times the number of the employee’s years of service for the organization, minus the total elective deferrals made for earlier years. If an employee qualifies for the 15-year rule, his or her elective deferrals under this limit can be as high as $23,500 for 2022.

Permitted:

• Exchanges and transfers between the participating vendors (see list of eligible vendors below) will be permitted;
• Catch up provisions for employees with 15 years of service are permitted;
• Catch up provisions for employees who will attain age 50 or more by the end of a calendar year are permitted;
• Hardship withdrawals are permitted; limited to the amount of total elective deferrals and generally do not include any income earned. Participant must satisfy both that an immediate and heavy financial need exists, and that the withdrawal is necessary to satisfy that financial need. Hardship withdrawals must meet the requirements of the IRS regulations and are subject to the 10% early distribution penalty on distributions made prior to reaching age 59 1⁄2 . Hardships are not allowed from de-selected vendors.

Not Permitted:

• Roth 403B Contributions are not permitted under the Plan;
• Direct rollovers from Roth 403b or Roth 401k Plans are not permitted;
• Transfers from another employer’s 403(b) Plan to Richland Two’s 403(b) Plan will not be permitted;
• 5-year post-severance provisions are not offered in the Plan;
• Loans are not permitted under the Plan.