Date: December 23, 2009
To: Pension Plan Participants
From: Vivian Fernández
Vice President Faculty and Staff Resources
Subject: 2010 Voluntary Tax-Deferral Limit

As the tax season approaches, it is a good time to begin planning for ways in which to maximize retirement savings while reducing your tax liability. Eligible Rutgers employees may elect to contribute to two optional tax-deferred retirement programs in addition to their current retirement plan: the Voluntary Tax-Deferred Annuity IRC 403(b) Plan and the New Jersey State Employees Deferred Compensation IRC 457 Plan. There are limits to the amount of income that can be tax deferred through these programs. I am pleased to announce that your personal voluntary tax-deferral limit is now available online.You may access our secure website at any time to view your 2010 tax-deferral limit, change your contribution percentage, or select a different investment carrier.

The Voluntary Tax-Deferred Annuity IRC 403(b) (TDA) and the New Jersey State Employees Deferred Compensation IRC 457 plans are separate plans, and participation in one plan has no effect on participation, including the tax-deferral limits, in the other plan. Contributions to these plans reduce your federal taxable income, as federal income tax is not due on the deferred contributions or earnings until you receive distributions from the plans. For these reasons, both plans can be a great way to save additional dollars towards retirement.

Choosing to make additional tax-deferred contributions is an important financial planning decision. Current tax laws allow most individuals to save at least $16,500 in 2010. Our online process makes it easy for you to take advantage of the Voluntary Tax-Deferred Annuity IRC 403(b) option. Enrollment forms must be completed to enroll in the New Jersey State Employees Deferred Compensation IRC 457 Plan. If you are already enrolled in the New Jersey State Employees Deferred Compensation IRC 457 Plan, you may make changes online by visiting the Prudential New Jersey State Employees Deferred Compensation website.

The 2010 tax-deferral limits are $16,500 (for a total of $33,000 using both plans) for employees under age 50 and $22,000 (for a total of $44,000 using both plans) for employees over age 50. Employees with 15 or more years of service may be eligible to tax-defer an additional $3,000 per plan, if they have not contributed the maximum amounts in previous years.

Visit the University Human Resources website for additional information regarding the two optional tax-deferred retirement programs. If you do not wish to submit your transaction online, access the Carrier Allocation/Salary Reduction Agreement form, and send your completed form to Payroll Services, 65 Davidson Road, ASB Room 317, Busch Campus.

Should you have questions or need assistance, please contact a University Human Resources Benefits Specialist via emial or by calling 732-932-3020, ext. 4077.