A 403b plan, also known as a tax-deferred annuity (employee contributions only) and defined contribution (employer and employee contribution) plans, is a retirement plan. A 403b plan allows employees to contribute some of their salary to the plan. The employer may also contribute to the plan for employees (eligibility requirements can be found in the Summary Plan Description).
Tax Deferred Annuity Plan
You will be eligible to contribute a portion of your pay to the plan as a pre-tax deferral, unless you fall into one of the following categories of excluded employees:
- You are a nonresident alien and you received no income from within the United States.
- You are a student enrolled and attending classes offered by your employer and your employer is a school, college or university.
Defined Contribution Plan
You will be eligible to contribute a portion of your pay to the plan as a pre-tax deferral, if you:
- are employed for 12 consecutive month(s) of service with Niagara University;
- you are an employee who works 1,000 hours or more per year;
- have a salary deferral of at least 3% non-faculty and 2.5% faculty.
There are significant tax advantages for participants in a 403(b), including pre-tax contributions to a 403b plan. Also, earnings on these contributions are not taxed until they are distributed from the plan.
Niagara University offers two retirement plan options - AXA Equitable and TIAA-CREF.
Employees should check with their employer to determine how to enroll in the plan.
All contributions into the plan are fully vested.
Yes, loans and hardships are available through AXA and TIAA-CREF.
In terms of loan options, the plan is designed primarily to help you save for retirement. You may take a loan from the plan as outlined below, subject to the terms and restrictions in the individual agreements. Generally the minimum loan amount that you may take is $1,000 and the maximum loan amount is $50,000.
You may also take a portion of the contributions you receive from your employer that are held in annuity contracts to satisfy a financial hardship if you have no other available resources.
The following events qualify as a hardship distribution under the plan:
- Medical expenses for you, your spouse or your dependents, or your beneficiary.
- Payment to purchase your principal residence.
- Tuition and education-related expenses for you, your spouse or your dependents, or your beneficiary.
- Payments to prevent eviction from your principal residence.
- Funeral expenses for you, your spouse or your dependents, or your beneficiary.
- Payments to repair your principal residence that would qualify for a casualty loss deduction.
Employees should contact AXA and TIAA-CREF directly for further information pertaining to loans and hardships.