joel Posted December 4, 2002 Share Posted December 4, 2002 A public school teacher is 55 years of age and earns $81,000 per year. He has never made any elective deferrals. The employer offers three plans for elective deferrals---a 403(B), a 401(k) and a 457(B). What is the maximum elective deferral for 2003? Link to comment Share on other sites More sharing options...
Archimage Posted December 4, 2002 Share Posted December 4, 2002 The 402(g) limit is $12,000 plus $2,000 catchup contribution for the 2003 tax year. Link to comment Share on other sites More sharing options...
mbozek Posted December 4, 2002 Share Posted December 4, 2002 $31,000-$17,000 to the 403(B)/401(k) under 402(g) and 14k to the 457(B) plan mjb Link to comment Share on other sites More sharing options...
Archimage Posted December 4, 2002 Share Posted December 4, 2002 Oops, sorry. I just noticed you said those three plans were available. I guess I should read more thoroughly. I agree with mbozek. Link to comment Share on other sites More sharing options...
joel Posted December 4, 2002 Author Share Posted December 4, 2002 Is there a reason why you didn't include the Deferred Acceleration for Retirement Amount (DAR) available in the 457(B) plan for those that have not maximized their 457 contributions in prior years? As you know this is worth another $12,000 for 2003. However, one cannot take the age 50 catchup amount ($2,000) at the same time. So is it correct to say that your total of $31,000 should be increased by $10,000 for a total deferral of $41,000? Peace and Hope, Joel L. Frank Link to comment Share on other sites More sharing options...
david rigby Posted December 4, 2002 Share Posted December 4, 2002 I think all references to catch-up contributions assume the plan has been amended to include that. I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice. Link to comment Share on other sites More sharing options...
Guest planman Posted December 18, 2002 Share Posted December 18, 2002 Related question: A 45 year old making $60,000 can contribute to a 401(k) and 403(B). What is the combined maximum pre tax contribution for 2003? I thought I saw $13,000 somewhere. Based on plan features/expenses, he is motivated to maximize the 401(k) contributions(i.e. $12,000) before contributing to the 403(B). Thanks. Link to comment Share on other sites More sharing options...
joel Posted December 19, 2002 Author Share Posted December 19, 2002 The combined total for 2003 is $12,000. If he had a 457(B) at his disposal he could defer $24,000 by contributing $12,000 to the 457(B) and a combined total of $12,000 to the 403(B)/401(k). Link to comment Share on other sites More sharing options...
mbozek Posted December 19, 2002 Share Posted December 19, 2002 A participant with 15 years of service with a eligible 501©(3) employer can defer an additional 3k per year to a 403(B) plan for 5 years for a max of 15k which when combined with the 457 plan would total 27K.Contributions to a 401(k) plan would reduce the 15k contribution to the 403(B) plan but not affect the 457 contribution. See IRS pub 571 for definition of eligible employer. mjb Link to comment Share on other sites More sharing options...
joel Posted December 19, 2002 Author Share Posted December 19, 2002 mbozek, Would you please respond to my 2nd post in this thread. Thank You. Link to comment Share on other sites More sharing options...
Guest Yanikoski Posted December 19, 2002 Share Posted December 19, 2002 The $41,000 is correct, assuming that the employee is within the last three years of service prior to the normal retirement age. Link to comment Share on other sites More sharing options...
mbozek Posted December 20, 2002 Share Posted December 20, 2002 403(B) = 12k+3K+2K= 17k: 457= 12K+12K= 24 or 41k combined. mjb Link to comment Share on other sites More sharing options...
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