Comparing the IU Supplemental Retirement Plans
In addition to your base retirement benefits, the university gives you the option to save even more with the IU Tax Deferred Account (TDA) and 457(b) retirement plans. These plans allow you to enhance your retirement savings through voluntary pre-tax and after-tax Roth contributions. As an eligible employee, you can participate in one or both plans as long as you do not exceed the annual IRS limits.
KEY SIMILARITIES:
- Both plans allow you to make pre-tax and after-tax contributions
- If you need to withdraw money while you’re still working for IU, both plans allow you to do so starting at age 59½
- Both plans are participant-directed and have the same investment choices
- Rollovers of existing retirement plan funds can be made into both plans
KEY DIFFERENCES:
- 10% early withdrawal penalty on IU TDA distributions before age 59½, even if you no longer work for IU
- Annual recordkeeping fees
- Aggregation rules with other retirement plans
- Special catch-up contributions at age 62, 63, and 64 for the 457(b) Plan
Review the table below to discover additional similarities and differences between the plans.
Publications
| IU 457(b) Retirement Plan | Tax Deferred Account (TDA) 403(b) | |
|---|---|---|
| Eligibility and General Plan Details | ||
| Eligibility | All IU employees | Academic and Staff employees (including IU Residents) appointed at 50% or more FTE
Part-Time with Retirement employees |
| Vesting | Immediate 100% vesting | |
| Annual Recordkeeping Fee | $45 | $28 |
| Contributions | ||
| Pre-tax and Roth (after-tax) Contributions | Yes | |
| Contribution Methods | Flat-dollar or percentage of pay | |
| Employee Contributions | Up to $22,500 for 2023 / $23,000 for 2024 Additional $7,500 if age 50+ Some participants may be eligible to contribute up to an additional $22,500 for 2023 / $23,000 for 2024 at age 62, 63, 64. (IRC 457(b) limit – includes employer and your contributions to all 457(b) plans combined) |
Up to $22,500 for 2023 / $23,000 for 2024 Additional $7,500 if age 50+ (IRC 402(g) limit – includes your contributions to certain 403(b), 401(k), and SARSEP plans combined) |
| Age 50+ Catch-up Contributions | $7,500 for 2023/2024 | |
| Age 62, 63, 64 Special Catch-up Contributions | Some participants may be eligible to contribute up to an additional $22,500 for 2023 / $23,000 for 2024 at age 62, 63, 64. | No |
| Contribution Limit | Total of employer and your contributions to all 457(b) plans cannot exceed $22,500 for 2023 / $23,000 for 2024 (plus applicable catch-up amounts) (IRC 457(b) limit – includes all contributions to 457(b) plans combined) |
Total of employer and your contributions cannot exceed lesser of your annual compensation or $66,000 for 2023 / $69,000 for 2024 (IRC 415(c) limit – includes all contributions to certain 403(b), 401(a), SEP, and 401(k) plans combined) |
| Rollovers | Yes | |
| Distributions and Withdrawals | ||
| Hardship Distributions | No | |
| Loans | Yes | |
| Distributions (Withdrawals) |
Upon separation of employment or at age 59½ while still employed by IU | |
| Early Withdrawal Penalty | No | 10% penalty on distributions prior to age 59½ |
| Required Minimum Distributions (RMD) | Yes. At age 72 or upon retirement/separation, whichever is later | |