Tax-Deferred Annuity (TDA) Plans
Information and Support for Faculty and Staff
A Tax-Deferred Annuity Plan (TDA) allows you to invest in fixed and variable annuities and mutual funds in a tax-deferred account which allows you to save more for retirement outside of the university sponsored retirement plans. You have the choice of contributing in a pre-tax and/or after-tax options. Contributions are not matched by the university.
All Faculty and Staff are eligible to participate.
When You Can Make Changes to Your Benefits
You are allowed to change your contribution amounts on a monthly basis and changes will be effective for the current month if the request is submitted prior to payroll processing. If the request is submitted after payroll has processed, the change will be effective the following month.
You will need to contact your 403(b) vendor to establish your account and set up your investment options.
How to Make Changes to Your Benefits
UNI Employee Benefits Self-Service
Benefits Self-Service System is designed to help you enroll, make changes, and view your current benefit elections all in one location. For additional support, visit the Benefits Self-Service Help site.
Your Next Steps After Choosing to Enroll in a TDA
Some vendors require action prior to your first payroll contribution:
- Fidelity requires the account to be established prior to the first contribution. Contact Fidelity to discuss your investment options.
- Set up or access your existing account on Fidelity's Webpage.
- You will need your user ID and password.
- If a new user, click on register as new user.
- University of Northern Iowa 403b Plan id is 57984.
- TIAA suggests that you schedule a personalized investment consultation session using the online scheduler or by calling 800-732-8353 (available weekdays from 7 a.m. – 7p.m. CST). As a participant in a TIAA retirement plan, you can receive personalized investment guidance on the plan’s investment options from a TIAA financial consultant. This on-campus service is available as part of your retirement program and is at no additional cost to you.
After your first payroll contribution to the following vendors, you may now set up your account:
You have two choices on how to contribute to your TDA
- The amount elected will be the same amount deducted each month unless you make a change. This amount will carry over from year to year.
- Example: If you elect a $100 monthly contribution this amount will continue to be deducted even when the new year starts in January.
- The amount will be divided by the number of pay periods you have remaining in the current year.
- Example you elect an annual contribution amount of $2,400 in November and receive 12 paychecks, since there are only two months left in the year, you would have $1,200 deducted from your November and December paychecks.
- If you do not make a change, your annual elected amount will start over in January.
Using the example above:
- In January, your amount would adjust to reflect $2,400 over the full 12 benefit deductions. You contribution amount would reduce to $200 monthly to equal a total of $2,400 by December 31.
Complete the Benefits Self-Service request to begin your payroll deductions.
Roth contributions are included in your maximum yearly contribution limits, plus any catch-up limits, if applicable. Please consult a tax adviser for specific questions and how these contributions impact you.
TDA Pre-Tax Option
- Pre-tax contributions are deducted from your paycheck before taxes, which reduces your taxable income and the amount of taxes you pay now.
- These deductions are subject to taxation at the time of withdrawal from your tax-deferred retirement account.
- Withdrawing earnings prior to age 59 ½ may be subject to a 10% additional penalty tax
- Vendors offering Pre-Tax TDAs:
TDA Roth After-Tax Option
- After-tax contributions are deducted from your paycheck after taxes are withheld. Which results in a higher taxable income and greater tax savings later
- After-tax contributions allow you to enjoy tax-free distributions, without penalty, when you are age 59 ½ or older and you take your first distribution at least five years after your first Roth contribution to the contract.
- Withdrawing earnings prior to age 59 ½ may be subject to a 10% additional penalty tax.
- If your taxable salary will be higher in retirement than it is currently, this after-tax deduction may be beneficial.
- For example, if your taxes at age 35 are 25% and you expect your taxes at age 65 to be 35%, you would be saving on taxes prior to retirement by using a Roth TDA.
- Vendors offering After-Tax TDAs:
|Description||Enrolled in Pre-tax Contributions||Enrolled in After-tax Contributions|
|Your Annual Pay||$45,000.00||$45,000.00|
|= $35,000.00||= $45,000.00|
|Tax Obligation (above amount multiplied by 27.9%)||-$9,765.00||-$12,555.00|
|= $25,235.00||= $32,445.00|
|Roth After-tax Contribution||-$0.00||-$10,000.00|
|Your Annual Take-Home Pay||= $25,235.00||= $22,445.00|
2023 Contribution Limits at a Glance
|Age||UNI Years of Service||Contribution Limit|
|Under 50||Less than 15||$22,500|
|Under 50||More than 15||$25,500*|
|50 or older||Less than 15||$30,000|
|50 or older||More than 15||$33,000*|
|Note: Contributions above the basic $20,500 limit count against your 15-year catch-up lifetime limit first. Only amounts above the basic $20,500 and 15-year catch-up count as age 50+ catch-up contributions.|
|The maximum tax-deferred contributions are determined by the IRS and are set for the Calendar Year, January 1 - December 31.|
|*The 15-year lifetime catch-up provision is not guaranteed. Please contact email@example.com to see if you qualify.|
If you are age 50 or over, you are eligible to take advantage of the "Catch-up Provision" and may defer additional amounts.
Lifetime Catch-Up Provision
The Lifetime Catch-Up Provision allows you to contribute an additional $3,000 over the annual IRS limit if you have been employed at UNI for 15 years or more; unless:
- You have already contributed $15,000 in prior years because of this rule, or
- You have already contributed $5,000 times the number of your years of service at UNI in a TDA in prior years.
If you are enrolling in a TIAA TDA and would like to know if you qualify for the Lifetime Catch-Up Provision, please email firstname.lastname@example.org. If you are enrolling in a VALIC, Fidelity, Ameriprise, or GALIC TDA, please contact your financial advisor.
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