Limits for Defined Contribution Plans to Increase in 2015
The Internal Revenue Service (IRS) has increased the 2015 contribution limits for the 403(b) and 457(b) plans to $18,000 for each plan. In addition, the IRS has increased the limits for the Age 50 Catch-up Provision. Under the provision, any participant who is 50 years of age or older at any point during the calendar year may contribute an additional $6,000 to each plan. If you are an employee who will be at least 50 years of age in 2015, you may contribute a total of $24,000 to each plan.
To initiate a higher contribution amount beginning with the first pay advice in January, you must complete and submit the proper form(s) to the Employee and Retiree Service Center by Friday, Dec. 19.
Download the forms now:
- Download the 403(b) Salary Reduction Agreement to update your 403(b) plan contributions.
- Download the 457(b) Salary Deferral Agreement to update your 457(b) plan contributions.
Not saving with a 403(b) or 457(b) plan yet?
Defined contribution plans allow you to save for retirement with pretax dollars, which reduces the taxes you pay on your current income. You do not pay taxes on that income or on your investment earnings until you withdraw the money. Once you choose how much to contribute, your contributions are taken directly from your pay and deposited into a retirement savings plan account. You may start and/or stop contributions or change your contribution amounts throughout the year.
Learn more about 403(b) and 457(b) plans and how to start saving for retirement on the ERSC web page.
Attend a Seminar on Maximizing Retirement Income
MCPS hosts monthly educational seminars focused on investment and retirement savings topics. The seminars feature speakers from 403(b) and 457(b) vendors who serve MCPS. The next session will be held Monday, Dec. 15 from 4:30–6 p.m. in the Maple Room at 45 W. Gude Dr., in Rockville. Representatives from Voya will present “Social Security Planning: What Baby Boomers Need to Know to Maximize Retirement Income.” To register for this session, log in to Professional Development Online (PDO) and search for course number 74817.
Retirement Informational Workshops Offered Into the Spring
ERSC conducts Retirement Informational Sessions for employees who are considering retirement within the next two years. Topics for each informational session include a timeline for retirement, eligibility, benefit formulas, leave, post-retirement health and life insurance, taxes, and forms. ERSC staff is available to answer questions and help with the retirement process. In addition to the regular Informational Sessions, ERSC holds sessions specifically for members of the MCPS core and supplemental retirement plans.
After attending an informational session and downloading retirement forms, you may also want to attend an ERSC Retirement Forms Workshop. During these workshops, staff members present the required retirement forms, explain how to complete them, and answer questions. ERSC also holds forms workshops specifically for MCPS core and supplemental plan members.