« Home
403 retirement plans are tax deferred retirement plans available to employees of educational institutions and certain non-profit organizations as determined by section 501(c)(3) of the Internal Revenue Code (IRC).
I've 10 facts here on 403b which you should know.
Fact 1: The Workings Of 403b Plans
You set aside money for retirement on a pre-tax basis through a salary reduction agreement with your employer. You choose from among the vendors offered by your employer where you want to invest the money. The money grows tax free until you withdraw it at retirement.
Fact 2: who Can Contribute To A 403b
If you're an employee of tax-exempt organizations established under section 501(c)(3) of the IRC, you're eligible to participate and start contributing.
Teachers, school administrators, school personnel, nurses, doctors, professors, researchers, librarians and ministers are contributors to the plan.
Fact 3: Why Contribute to a 403b
Your employer provides you with a pension upon your retirement. However, the pension plan may not provide an amount equal to your salary. A 403(b) plan can provide a healthy supplement to your pension.
Fact 4: How Much You Can contribute Annually
You can contribute the smaller of:
Fact 5: Lower Taxes
You make 403b contributions on a pre-tax basis which can greatly reduce your tax bill. The tax savings grow bigger as your contributions increase.
Fact 6: More Tax Savings
All dividends, interests and capital gains earned in a 403b account are on a tax-deferred basis. This means your earnings will grow tax-free until time you withdraw them.
Fact 7: Part Time Employees Eligible To Contribute to 403b Retirement Plans
Your employer must extend the 403b plan to all the employees.
However, certain employees may be excluded, such as:
Fact 8: 403b Plan Does Not Reduce Social Security Benefits
Your contributions to a 403b reduce taxable compensation for federal (and in most instances, state) income tax purposes only. These contributions don't reduce wages for the purpose of determining Social Security benefits.
Fact 9: Special Tax Credit For Low-Income Savers
Eligible savers will receive a tax credit of up to 50% or up to $2,000 in contributions to an IRA, 403b, 457, SIMPLE, 401k plan and other tax-favored plans. The full credit is available to joint filers whose adjusted gross income (AGI) is less than $53,000, and for singles whose AGI is under $26,500.
Fact 10: A 403b Can Be Rolled Into An IRA
This occurs when you change job; retire; become disabled or die.
OK, you might think 403b retirement plans are more or less similar to 401k plans. But there's a big difference there - your eligibility.
If you're an employee in public schools and certain tax-exempt organizations (as determined by Section 501(c)(3) of the IRC), you're eligible for 403b. The 401k, on the other hand, covers private-sector employees
Due to her strong yearning to retire early in life, Cecelia Yap has been researching on the subject of retirement. She has found the most "viral" way to grow her retirement nest egg and you too can do what she does, here: http://www.perfect-body-toning.com/my-passion.html
Dear Margo - DEAR MARGO: I think my husband of 20 years had an affair.
Posted by frankvgmgzny | 10:21 AM | 
