Central Michigan University

403(b) Supplemental Tax Deferral Plan

403(b) Voluntary Salary Reduction Agreement

You can establish a 403(b) Supplemental Tax Deferral plan with TIAA-CREF and/or Fidelity Investments as a way to save more for retirement. The University does not match contributions to supplemental tax deferral accounts, however they are pre-tax deductions from your paycheck. This is a voluntary plan and all contributions are made by the employee.

Eligibility

All staff and faculty employees (including temporary staff and fixed term faculty less than half-time) are  eligible to participate. 

Contributions

This is a voluntary plan and all contributions are made by the employee on a pre-tax basis. Contributions must be deferred as a percentage of salary and must be done in quarter (1/4) increments.

You can start, stop, increase or decrease your contribution at anytime. Changes are effective the next available pay period.  Participants are allowed to contribute to both the 403(b) and the 457(b), if eligible. Refer to the comparisons grid to see the benefits and limitations of each plan.

Deferral amounts are indicated as a percentage (%) of salary.  Participants who contribute to both a 403(b) and to a 457(b) plan will be allowed to contribute the maximum amount permissible to both plans.

A special catch-up limit allows participants who are age 50 and over to contribute an additional amount each year. 

Vendors

You may direct your 403(b) Supplemental Tax Deferral Plan contribution to one or both vendors: TIAA-CREF and/or Fidelity Investments. For detailed information on allocations & investments, withdrawals & rollovers and distribution payout options click on:

TIAA-CREF     and/or    Fidelity Investments

Vesting

"Vesting" refers to an employee's right, usually earned over time, to receive some retirement benefits regardless of whether or not they remain with the employer. Your contribution to this account will be 100% vested immediately.

Taxation

Because you make contributions with pretax dollars, federal income taxes are deferred on supplemental plans until you begin taking withdrawals later on.

No taxes are due on contributions and earnings until the money is withdrawn, but because these plans are intended primarily for retirement, you can generally withdraw funds only after termination of employment or age 59½ (subject to plan rules). If you withdraw funds before age 59½, they may be subject to an additional 10% early-withdrawal penalty.

For additional information and guidance, contact your tax advisor.