|ATTENTION:||Human Resource, Benefit and Payroll
Officers and State Employees
Participants in the 457 Deferred Compensation and 403(b) Plans
|SUBJECT:||2017 IRS Maximum Contribution Limits and the Need to Restart Contributions for Participants who met maximum limits during 2016|
The purpose of this memorandum is to announce the 2017 limits for contributions to the State of Connecticut 457 Deferred Compensation Plan and the 403(b) Plan and to explain how participants whose contribution(s) were stopped because they reached the 2016 annual limit can restart plan contributions for 2017.
II. CONTRIBUTION LIMIT
The amount that employees can contribute to the 457 or the 403(b) Plan each year is limited by the Internal Revenue Code. The Internal Revenue Service (IRS) recently announced that the contribution limits for 2017 will be unchanged. The maximum amount an individual under the age of 50 may contribute to a 403(b) or 457 Plan during 2017 is $18,000. Employees who will be at least age 50 by December 31, 2017 are eligible to contribute an additional $6,000.
The annual limit applies to pre-tax contributions, post-tax contributions or any combination of the two. Employees who are eligible for both the 403(b) and 457 Plans may contribute the 2017 maximum amount to each plan. The minimum contribution amount for the 457 Plan is $20 per pay period and $200 annually for the 403(b) Plan.
III. RESTARTING AND INCREASING CONTRIBUTIONS IN 2017
Employees whose contributions were stopped upon reaching the maximum 2016 limit must elect to re-start their contributions to the 403(b) or 457 Plan for calendar year 2017. See the attached 2017 Payroll Cut-off Schedule for the applicable deadlines for submitting changes. To avoid restarting your contributions too early, do not submit an online, telephone, or paper contribution change request before December 1, 2016.
Employees enrolled in the 457 and 403(b) Plans can restart their contributions online by following these instructions:
Prudential can also accept contribution changes and restarts for the 457 and 403(b) Plans by telephone. You can reach Prudential at 844-505-SAVE (7283).
For all other employees actively contributing to the 403(b) and 457 Plans in 2016, your contribution election will continue for 2017 unless you initiate a change.
Payroll and Human Resources Personnel are encouraged to provide this information to all employees. Employees who have questions regarding the 403(b) or 457 Plan should call Prudential at 844-505-SAVE (7283) or log onto www.ctdpc.com for more information. You may also contact the Employee Benefits Unit for assistance at 860-702-3543 or at firstname.lastname@example.org.
Very truly yours,
THOMAS C. WOODRUFF, Ph.D.
Attachment: 2017 Payroll Cut-off Schedule
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