Retirement

Voluntary 403(b)

The University of Alaska provides a voluntary, supplemental retirement plan - the 403(b). This retirement vehicle offers employees the opportunity to make additional retirement contributions in two ways: (1) pre-tax (Tax-deferred Annuity) and (2)  post-tax (Roth) contributions outside their required contributions to their respective retirement plans (either PERS, TRS, or ORP). 

 

All Employees
All University of Alaska employees are eligible to participate in the 403(b). This includes students, adjuncts and other temporary employees. Participation in this plan is voluntary and consists of employee contributions only. 

Employees Manage All Aspects of Account
While UA allows you to contribute to a 403(b) through payroll deduction, the management of the account lies entirely with the employee - including managing maximum contribution limits. 

UA Cannot Provide Financial Advice
Employees are encouraged to speak with a financial advisor before opening/changing a voluntary 403(b). The UA Benefits team is not able to provide financial planning advice.

Contribution Limits Set by IRS
Contribution limits are set by the IRS each calendar year.

For calendar year 2023, the contribution limit is $22,500.
For calendar year 2024, the contribution limit is $23,000.

Elective deferrals for both Tax-deferred Annuities (TDA) and for Roth accounts combined for a calendar year may not exceed the IRC limit under Section 402(g).

Catch-up Amounts 
If you are over the age of 50, you are eligible to contribute an additional $7,500 catch up amount bringing the total to $30,000. 

Initial Contributions and Set-up

Tax-deferred Contributions
To start a new Tax-deferred 403(b), review our list of vendors below and open an account with your preferred provider.

Roth Contributions
The Roth option is available with TIAA only. If you already have a TIAA voluntary 403(b) you can begin designating contributions as Roth contributions as early as December 17, 2023. If you do not have a TIAA voluntary 403(b) account already, you will need to open an account with TIAA to begin making Roth contributions. 

Account Required
You must have an account with your provider before UA HR will begin your contributions toward the account.

Making Changes to your Provider or to your Contribution Limit or Contribution Type
You can make any of these changes at any time.

Provider Change
If you want to change your current 403(b) fund sponsor to a different fund sponsor, you must indicate on the form that you are stopping deductions for one provider and starting them for another provider. We will not automatically stop any live deductions without an employee's direct authorization. You can make both changes on the same form by selecting your current 403(b) provider and entering "$0" to stop the deductions and entering the dollar amount for the new provider immediately below. Stopping the deduction does not move the funds from one fund sponsor to another. If you would like to move funds between your 403(b) fund sponsors, please reach out to the sponsor directly for the process and paperwork. 

Contribution Limit
To update your contribution limit, complete a new form and indicate your new biweekly and yearly goal amount(s). Be sure to designate if these contributions will be pre-tax (tax-deferred) or post-tax (Roth). 

Contribution Type
To update your contribution type, complete a new form and indicate your biweekly and yearly goal amount(s) and what type (pre-tax or post-tax). Changing your deduction from pre- to post-tax will not move the funds from one type of contribution to the other. 

Tax-deferred Providers

Roth Providers

Form
403(b) Enrollment Form

Name Beneficiaries with the Provider
It is the employee's responsibility to maintain accurate beneficiary records with their managing fund sponsor. Contact your provider directly or login to your account to update/review your beneficiary designations.

When Can Funds be Accessed?
Per IRS guidelines, withdraws from a TDA can begin with the member is age 59.5. Withdraws prior to age 59.5 may face additional tax penalties for early withdraw. Special considerations may apply. Please reach out to your provider or financial advisor directly to discuss your particular options. As you are preparing for retirement, please review our offboarding webpage which provides detailed information on separating from the university.

Applying for Retirement

  1. 403(b) accounts have a few different options available for retirement withdraws. Please contact your financial planner prior to your retirement to discuss your options.
  2. To initiate your desired retirement, contact your provider directly for the paperwork required for the action you are wishing to take.
  3. Complete and submit the provider paperwork to Planwithease. Remember - these documents have sensitive personal information included. Be sure to send all documents password protected or securely via fax to ensure your personally identifiable information is protected.

Actions for Employees Separating but Not Retiring
If you are separating from the university but are not retiring, there are a few different considerations for your 403(b). The university also has an offboarding webpage which provides detailed information on separating from the university. 

  • You may take no action and leave all funds in your 403(b).
  • You may rollover your vested funds into another qualified tax-free retirement account such as an IRA, or you can rollover your vested funds into a new employer's eligible retirement account.

UA Cannot Provide Financial Advice
Employees are encouraged to speak with a financial advisor before changing or taking action against a voluntary 403(b). The UA Benefits team is not able to provide financial planning advice.

In-service Distributions
An in-service distribution from a voluntary 403(b) account is highly regulated by the IRS. In-service distributions are allowed for qualified loans, qualified hardship distributions, QDROs, or if the employee is over 59.5. These apply to the voluntary 403(b) only. No in-service distributions are allowed in Public Employees Retirement Plan (PERS), Teachers Retirement Plan (TRS), the Optional Retirement Plan (ORP) or UA Pension Plan.

Obtaining a Loan or Hardship Distribution
Contact your voluntary 403(b) provider directly to initiate a loan or hardship distribution. Loans and hardship distributions are only allowed from current active providers.

  • TIAA
  • Fidelity
  • Lincoln
  • Corebridge (VALIC)
  • American Funds
  • Vanguard
  • VOYA

Voluntary 403(b)  providers allow participating employees to borrow against their voluntary 403(b) account in the form of a personal or residential loan. Please work with your voluntary 403(b) provider directly for information on what loans are allow and what proof is required. 

Loans are only allowed with UA's active 403(b) vendors. These vendors are:

  • TIAA
  • Fidelity
  • Lincoln
  • Corebridge (VALIC)
  • American Funds
  • Vanguard
  • VOYA

Loans cannot be processed with voluntary 403(b) vendors that are not currently active and eligible to receive direct payroll contributions. If an employee would like to apply for a loan and has funds with an inactive voluntary 403(b) vendor, the employee may roll the funds over to an active voluntary 403(b) vendor.

Hardship distributions are available for an immediate and heavy financial need, such as severe medical debt, risk of foreclosure or eviction, educational expenses, expenses to repair damage to the employee's home, and others. 

If an employee's voluntary 403(b) account is involved in a Qualified Domestic Relations Order (QDRO), the employee must work with their vendor directly to process the order. 

Employees can also access their voluntary 403(b) accounts after age 59.5 even if they are still employed.  All pre-tax distributions made directly to the employee (not rolled over or transferred to another pre-tax qualified account) are taxable in the year the employee takes them.


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