Federal tax law offers employees the opportunity to make pretax or Roth 403(b) after tax contributions to taxsheltered plans. For calendar year 2014, employees under the age of 50 may elect to contribute a total of $17,500. Employees aged 50 and over may elect to contribute an additional $5,500, to a total of $23,000 on a pretax basis.
Employees may elect to begin voluntary contributions effective the first of any month. For employees eligible to participate in the base plan, employee contributions are included in the $17,500 or $23,000 limit. Employees who wish to elect to shelter the “maximum” should contact Heather Woods or Jennifer Silvestri for individual calculations. Employees who have previously elected the “maximum” will have their amounts recalculated and should receive written notification of the revised amount.
It is important to note that these limits apply to individual employees during the calendar year and include all plans in which they may participate. IRS penalties may apply if an individual contributes too much.
The IRS has also increased the amount of compensation that may be considered for retirement plan purposes. Employees who became participants in the Temple University Defined Contribution Plan after 12/31/1995 have a limit on the amount of salary that is eligible for pension plan consideration. That limit has increased to $260,000 for calendar year 2014.