403(b) Glossary

Code section of the Internal Revenue Code which governs 403(b) plans. The terms Tax-Sheltered Annuity and 403(b) plan are generally used interchangeably.

Retirement plan available to employees of certain tax-exempt employers. Taxes on eligible 403(b) plan contributions may be deferred. Also known as a Tax-Sheltered Annuity.

Investment contract with an insurance company. Annuities can be fixed or variable. In a variable annuity, the performance of the underlying investments in a portfolio will determine the value of the annuity. A fixed annuity provides guaranteed rate of return and a fixed benefit payable upon annuitization.

Contribution above and beyond the annual base contribution limit set by the IRS. Catch-up contributions may be made beginning the year in which you turn age 50. You may also qualify to make catch-up contributions if you have worked for your employer for 15 or more years and your lifetime 403(b) contributions have averaged less than $5,000 per year. You must complete and submit a Maximum Allowable Contribution worksheet in order to be eligible to utilize a catch-up.

Money deposited into your retirement plan account.

Account created at a bank, brokerage firm, or mutual fund company through which investments in mutual funds can be made.

Event which may qualify you to receive a distribution from retirement plan account.

Withdrawal of money from a retirement plan account.

The exchange or movement of 403(b) plan money between different investment providers within the same plan.

Investment contract with an insurance company which provides a guaranteed rate of return and a fixed benefit payable upon annuitization.

Qualifying situation which may enable you to receive a distribution from a retirement plan account. Generally, a hardship imposes an immediate and heavy financial burden upon a retirement plan participant. Hardship withdrawals usually cannot be received unless all other options have been exhausted. These options include: insurance, reasonable liquidation of the employee's assets, cessation of elective deferrals to the plan, other distributions, and loans.

Maximum amount a plan participant may defer to a 403(b) plan during a calendar year. Your MAC may be determined using the Maximum Allowable Contribution Worksheet found on the employer's forms page.

Minimum amount you may be required to have distributed from your 403 (b) account each year following the later of the calendar year in which you retire or attain age 70 1/2.

Investment company that pools money from shareholders and invests in a variety of securities including, stocks, bonds, or other financial instruments.

Transfer of retirement plan assets from one plan to a different plan or retirement savings vehicle. A distributable event must have been met to be eligible for a rollover. A rollover is generally more flexible than an exchange.

Money withheld from your paycheck by your employer and which is not treated as income during the year in which it earned if the money is contributed to an eligible retirement plan such as a 403(b) plan.

Legally binding agreement between you and your employer setting forth the terms of your participation in a retirement plan including the amount you will defer out of your paycheck and the investment vehicle which will receive your contributions.

Retirement plan available to employees of certain tax-exempt employers. Taxes on eligible TSA contributions may be deferred. Also known as a 403(b) plan.

Exchange of assets from the plan of one employer to the plan of a different employer.

Investment provider that has established an information sharing agreement with the employer (or with the employer's designated third party administrator) in accordance with the IRS' new 403(b) regulations. Only Transfer Eligible Providers may receive transfers of plan 403(b) amounts.

An investment contract with an insurance company the value of which is determined by the performance of the underlying investments in a portfolio.