Seminole State College Employee 403(b) Plan Eligibility Notice  (pdf)

 

 

403(b) Changes Effective January 1, 2009

 

The new regulations force the employer into a more responsible role, much like 401(k) regulations which have already been implemented in the private sector. Partnering with a recordkeeper allows Seminole State College to shift nearly all of the oversight to the recordkeeper. Here are some of the things the recordkeeper will be responsible for:

 

  • Oversight of 403(b) requirements and monitoring of eligibility, limitations and benefits under the plan.
  • Handle information sharing agreements between all vendors, whether current or past.
  • Annual notification of eligibility to all non-participants.
  • Oversight of all transfers.

There are others, but this gives you an idea of what will be involved. These new regulations are effective January 1, 2009.

 

Why is all this compliance so important?

 

The IRS has already stated that they have hired more field agents and have neglected the 403(b) employers for too many years. These new regulations will give the IRS new reasons to focus on higher education, in particular. If Seminole State College is found to be out of compliance, every penny of contributions in anyone’s 403(b) account could become taxable income to the employees.