Beginning January 1, 2016, a new Roth (post-tax) option will be available to you in the State of Illinois Deferred Compensation (Deferred Comp) 457 Plan. If you would like to take advantage of the new Roth option, you will need to complete an Enrollment Form and send it to University Payroll and Benefits (UPB).
For your election to be effective January 1, a completed Enrollment Form must be submitted to UPB by November 30, 2015. You may also wait and complete the form later, but your Roth contributions will also begin later.
If you are an active participant in the Deferred Compensation plan, but do not want to make any Roth contributions, then no action is necessary. The Roth option exists in addition to the traditional (pre-tax) option. You can make traditional before-tax contributions and Roth contributions from the same pay checks, if desired.
Please note that whether or not you enroll in the Roth option, any current pre-tax deferrals will continue. Use the Change Form to stop or change pre-tax deferrals. To stop a pre-tax deferral, complete Section D. To change a pre-tax deferral, complete Sections A, B and C.
All forms should be sent to UPB and instructions for completing the 457 Enrollment and Change forms can be found on the Deferred Compensation “How To Enroll” page in NESSIE.
The Roth option gives you the opportunity to make after-tax contributions to your plan account. Roth contributions are taxed when you are paid, and are included in current taxable income. Roth contributions and any associated earnings can be withdrawn tax-free if part of a qualified distribution. Qualified distributions are those made at least five years after the first Roth contribution, and upon one of the following events:
- Participant attains age 59 ½
- Participant’s death
- Participant becomes totally disabled
2016 Contribution Limit
The 2016 contribution limit for the Deferred Comp Plan remains $18,000. You may contribute both traditional (pre-tax) and Roth at the same time, but your combined contributions cannot exceed the limit. You may be eligible to contribute more if you are over age 50 (up to $24,000) or are within 3 years of being eligible for full SURS retirement benefits (up to $36,000 with approval from CMS). For more information, visit the State of Illinois CMS website.
Information and Questions
For more information and comparisons to other retirement plans available to you, please see the State Deferred Compensation Plan page in NESSIE. If you need assistance completing forms or have further questions, contact UPB:
- Email: email@example.com
- Urbana: 217-333-3111
- Chicago: 312-996-6471
- Springfield: 217-206-7144 or 217-206-7211