IU Tax Deferred Account (TDA) Retirement Plan

The IU Tax Deferred Account (TDA) plan is a section 403(b) defined contribution retirement plan. This is a voluntary employee-funded plan; therefore, the participant makes all plan contributions.

The information on this page is only a summary. Review the IU Tax Deferred Account (TDA) Plan – Plan Document for a detailed description of the terms and conditions of the Plan.

Plan Details

Eligibility

To be eligible to participate in the IU TDA plan, an employee must be a(n):

  • Academic (including IU Residents) or Staff employee appointed at 50% or more full-time equivalent (FTE); or
  • Temporary employee appointed as “Temporary with Retirement”

Enrollment

Eligible employees may enroll in the plan at any time by following these step-by-step enrollment instructions to enroll in the plan, setup your account online through Fidelity NetBenefits, select your investments, and designate your beneficiaries. 

Contributions

Employees make all contributions to the plan. Contributions may be made on a pre-tax or after-tax Roth basis, and can be a flat-dollar amount or a percentage of pay. See the section below titled ‘Contribution Limits’ for additional details. 

Contribution Limits

  • $19,500 limit for 2020 for all employee (both pre-tax and after-tax Roth) contributions
  • Plus an additional $6,500 if you are age 50 or older.

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Contribution Limits

The information below is a summary of IRS contribution limits that apply to this plan. It is your responsibility to ensure you do not exceed these maximums between all of your retirement saving accounts. Visit the IRS Limits page for further details.

Total Contribution Limit – IRC 415(c)
For 2020, the calendar-year limit on total contributions is the lesser of 100 percent of your compensation or $57,000.

This total contribution limit applies to the sum of employer contributions to the IU Base Retirement Plan, the IRC 403(b) plan portion of the 18/20 Retirement Plan on behalf of a participant, and employee contributions to the Tax Deferred Account (TDA), except for the extra $6,500 that employees age 50 or older may contribute.

Note: The total contribution limit also applies to any contributions you make to 403(b) plan sponsored by employer in same controlled group as IU and, if you own 50% or more of an employer (such as a faculty practice plan), that employer's defined contribution 403(b), 401(a), 401(k) plan or SEP.

Employee Elective Deferrals – IRC 402(g)
For 2020, the IRS limit on employee contributions is $19,500. Participants age 50 or older may contribute an additional $6,500.  

The annual limit applies to employee contributions to any employer’s savings plan under IRC Sections 403(b) and 401(k). This includes the IU Tax Deferred Account Plan; the IU Health 401(k); If you own 50% or more of an employer (such as a faculty practice plan), that employer's defined contribution 403(b) or 401(k) plan; and salary deferrals to a SARSEP (a simplified employee pension (SEP) plan set up before 1997 that includes a salary reduction arrangement).

Vesting

A participant is always 100% vested in his or her plan account.

Investment Options

This is a “participant directed plan” meaning you are responsible for directing the investment of your plan account. If you do not select investments, your funds will be invested in the plan’s default investment option – and age-appropriate Vanguard Institutional Target Retirement Date Fund.

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Distributions & Withdrawals

A participant may only withdraw vested funds from his or her plan account upon (1) attainment of age 59 ½ or older while employed at Indiana University, or (2) termination of employment with Indiana University.

Loans may be available from your IU TDA or 457(b) plan accounts. Contact Fidelity directly to initiate the process. Loans are subject to both federal tax code and investment company rules and regulations. University authorization is not required to take a loan.

Fidelity
www.netbenefits.com/indiana
Service: 800-343-0860

For more information on distributions and withdrawals, visit the Frequently Asked Questions page. For information on Required Minimum Distributions (RMDs) see the ‘Options When You Separate from IU’ section below.

Options When You Separate from IU

All plan contributions stop when your employment with IU ends. Upon termination of employment, you may:

  • Leave accumulations in the plan account and continue to manage investments;
  • Withdraw all or a portion of vested plan account accumulations (subject to income taxes and/or penalty taxes); or
  • Roll over all or a portion of vested plan account accumulations to an eligible retirement plan (e.g., an IRA).

After terminating employment with the university, most transactions related to your plan account are handled directly with the applicable investment company. For more information, review the Benefits After Separation Guide.

Required Minimum Distributions at Age 70 ½ or 72
A federal law effective January 1, 2020 changed the age at which a person needs to begin taking required minimum distributions (RMD) from their retirement plan once retired or terminated.

  • The RMD is age 72 if you turn age 70½ on or after January 1, 2020.
  • The RMD remains age or 70½ if you reached age 70½ by December 31, 2019.

The IRS requires that you begin receiving distributions from your retirement accounts by April 1 of the calendar year following the calendar year you reach age 72 (or 70½) once retired or terminated. If you are already over age 72 (or 70½) when you retire or terminate, then you must take a distribution by April 1 of the following year.

Resources

Customer Service Contacts

IU Human Resources

Phone: 812-856-1234

Fidelity
www.netbenefits.com/indiana
Service: 800-343-0860
Appointment Scheduling: getguidance.fidelity.com or 800-642-7131
Speak to a Retirement Planner: 800-328-6608