HUMAN RESOURCES OFFICE EMPLOYEE ORIENTATION PROGRAM

1
HUMAN RESOURCES OFFICE EMPLOYEE ORIENTATION
PROGRAM

• DEFERRED COMPENSATION PLANS

2
DEFERRED COMPENSATION PLANS

• Tax Deferred Annuity, Section 403(b)
• Employees may enter into agreements to
  participate in tax-deferred annuity
• plans or programs consistent with Section 403(b)
  of the Internal Revenue
• Code and related provisions of the Internal
  Revenue Code, regulations,
• rulings, etc., and subject to the provisions of
  TBR guideline P-045.
• Eligibility
• All employees except students are eligible to
  participate in the Section 403(b)
• program.

3
DEFERRED COMPENSATION PLANS

• Limitations and Contributions
• The maximum contributions to a Section 403(b)
  program will be
• determined by Human Resources based on Internal
  Revenue
• Service provisions.
• The minimum contribution should be at a rate of
  two hundred dollars
• (200.00) per year.
• Employees participating in a 403 (b) deferred
  compensation plan must
• complete a 403(b) Participation Agreement form.
  This form can be
• obtained from the Human Resources web page
  at http//www.apsu.edu/hrhomepage/forms/403b_agree
  .pdf.pdf

4
DEFERRED COMPENSATION PLANS

• Limitations and Contributions (continued)
• The Participation Agreement form must be
  submitted to Human Resources the
• month before the annuity begins and be approved
  by the Benefits Manager.
• Vendors
• Austin Peay has approved agreements with the
  following vendors
• AIG VALIC 615-221-2541
• ING Aetna Financial Services 1-866-836-3659
• TIAA-CREF 1-800-842-2003

5
DEFERRED COMPENSATION PLANS

• Tax Deferred Annuity, Sections 401(k) and 457
• University employees are eligible to participate
  in two optional tax-
• deferred retirement savings plans operated by
  the state a 457 plan
• and a 401(k) plan. Contributions to these plans
  are made through regular
• payroll deductions. Salary set aside through
  these plans cannot be withdrawn
• before separation from service except under a
  few limited circumstances.
• Participants in either plan are permitted to
  direct their contributions among
• various investment options.

6
DEFERRED COMPENSATION PLANS

• Eligibility
• All employees except students are eligible to
  participate in the 401(k) and
• 457 plans.
• Administrator
• Great-West/BenefitsCorp serves as record keeper
  and provider of communication
• services for the program under the
  oversight of the State of Tennessee Treasury
  Department. Great-West/BenefitsCorp does not
  hold or invest your deferrals. Your
• deferrals are wired immediately to the
  companies you have selected from those
• that the state has authorized to provide
  investment products for the program.

7
DEFERRED COMPENSATION PLANS

• Administrative Fees
• The administrative costs for the program are paid
  by participants. For most
• 401(k) participants, the cost of
  administration is currently the equivalent of
• .22 of assets (22 basis points) annually
  or 3 per quarter, whichever is greater.
• For 457 participants, the cost of
  administration is currently the equivalent
• of .22 of assets annually. Several of the
  program's investment providers offer
• assistance with the basis point fee to
  participants who use their investments as
• detailed in your Quarterly Bulletin.

8
DEFERRED COMPENSATION PLANS

• Employer Match
• The university will match a maximum amount of 50
  per month in the 401(k)
• plan, e.g. if the employee shelters 60 per
  month, the university will only
• match 50. Availability of the match is subject
  to funds being appropriated
• each year.
• Employees participating in the Tennessee
  Consolidated Retirement Program or
• the Optional Retirement Program or eligible for
  the match if contributions are also made to the
  401(K) program.
• 401(k) and 457 Minimum Contribution
• The minimum deferral to either plan is 20 per
  month. If you are paid twice a
• month, the minimum deferral is 10 per paycheck.
  

9
DEFERRED COMPENSATION PLANS

• 401(k) and 457 Minimum Contribution (continued)
• Employees participating in a Traditional 401 (k),
  Roth 401(K) or 457 deferred compensation plan
  must complete a Participation Agreement form and
  submit it to Human Resources at
• least six weeks prior to the effective date of
  the first deferral and/or any
• subsequent payroll changes such as an increase,
  decrease, etc. These forms
• can be obtained from the Human Resources web
  page at
• http//www.apsu.edu/hrhomepage/forms.htm.

10
DEFERRED COMPENSATION PLANS

• 401 (k) Maximum Contribution
• The regular 401(k) deferral limit will 16,500
  for 2009.
• If you will be age 50 or older during the year,
  your 401(k) contribution limit
• is 22,000 for 2009.

11
DEFERRED COMPENSATION PLANS

• 457 Maximum Contribution
• The regular 457 deferral limit will be 16,500
  for 2009. If you will be age 50 or older during
  the year, your 457 contribution limit will
• be 22,000 in 2009.
• Additional Limits
• If you use a 401(k) plan and a 403(b) plan in
  2009, your total deferrals to both
• plans may not exceed 16,500 if you are under
  age 50, or 22,000 if you are
• age 50 or older.

12
DEFERRED COMPENSATION PLANS

• Additional Limits (continued)
• Deferrals to a 403(b) plan directly reduce the
  amount you may defer
• to a 401(k) plan and vice versa.
• Deferred Taxes
• You will not pay income taxes on the amount
  sheltered in the 403(b), 401(k)
• or 457 plans. To estimate how your
  contributions will affect your take home
• pay, use Fidelity's Take Home Pay Calculator.

13
DEFERRED COMPENSATION PLANS

• Deferred Taxes (continued)
• Each year that you participate in this program,
  your W-2 statement will be
• adjusted because of your deferrals. The amount
  of salary you defer will be
• included in your salary for Social Security
  (FICA) taxes. It will not be included
• in the salary reported to the IRS for income tax
  purposes.
• Longevity Payment
• You may defer any of your longevity bonus
  paycheck after you have enrolled
• in the program by completing an additional
  Salary Reduction Change Form
• for that paycheck each year.

14
DEFERRED COMPENSATION PLANS

• Longevity Payment (continued)
• Deferrals from your longevity paycheck may be
  directed to the 457 plan
• or the 401(k) plan, but cannot be divided
  between the two plans.
• Applicable Social Security taxes must be
  deducted, so the full bonus
• amount may not be deferred.
• Salary Reduction Forms must be submitted at least
  six weeks before the
• payday on which they are to take effect.
• If you make an Investment Option change for your
  longevity deferral, it will also
• affect any other contributions or loan
  repayments you are making to that plan.
• If you want to change your investment election
  for your longevity deferral and
• then change it back for the next pay date, you
  may do so.

15
DEFERRED COMPENSATION PLANS

• Changes and Cancellations
• To make a change in the amount of your future
  deferrals, you must complete
• a Salary Reduction Change form and submit it to
  the Human Resources Office.
• You may cancel your future deferrals at any time
  during the year, but you
• cannot withdraw previous deferrals from the plan
  until you meet one of the
• conditions for withdrawal.

16
DEFERRED COMPENSATION PLANS

• Investment Option Changes
• If you want to change the way your future
  deferrals are invested, use the on-line
• Account Access feature, or call KeyTalk at
  (1-800-922-7772).
• If you want to change the investment of your
  future deferrals in both the 457 and
• the 401(k) plan, be sure to make changes in both
  plans. Changing the direction of
• future deferrals does not affect money already
  on deposit.
• Account Statements
• You will receive a quarterly statement from Great
  West showing
• activity in your account during the quarter. The
  statement will include both a
• summary and a detailed listing of activity
  during the quarter. Statements are
• issued three weeks after the end of the quarter.
  

17
DEFERRED COMPENSATION PLANS

• Withdrawal of Funds
• Withdrawals will be permitted for the following
  reasons
• Retirement
• Termination of employment
• Death
• Disability
• Financial hardship (as defined by the plan)
• Age 59 ½ - 401 (k) plan only
• To make a withdrawal, the participant should
  contact the company to obtain
• instructions and a withdrawal form.
• For more detailed information, contact Human
  Resources. Forms can be obtained
• from the Human Resources web page at
  http//www.apsu.edu/hrhomepage/forms.htm