2016 Tax-Sheltered Annuity and Wisconsin Deferred Compensation Contribution Limits Announced
November 10, 2015
The Internal Revenue Service (IRS) has announced 2016 contribution limits for the UW Tax-Sheltered Annuity 403(b) Program (TSA) and the Wisconsin Deferred Compensation 457 Program (WDC).
In 2016, as in 2015, employees may contribute a basic maximum of $18,000 to the TSA program. Employees age 50 and over can contribute an additional $6,000 for a total of $24,000. These same limits apply to WDC. Employees can contribute the maximum to both programs for a total of $36,000 (under age 50) or $48,000 (age 50 and older).
Employees with 15 or more years of UW service who have contributed less than an average of $5,000 per year over their UW employment, may have an additional "catch-up" opportunity with the TSA program. Check with your Human Resources/Benefits office to see if you are eligible. For more information, see the web page on TSA limits.
Both pre-tax and Roth after-tax 403(b) or 457 contributions count towards the annual limit. For example, if you are under 50, you could contribute $10,000 pre-tax and $8,000 Roth after-tax to each program. Please note Roth IRAs are an investment completely separate from the UW 403(b) and WDC Programs.
Employees currently enrolled in the TSA program can change TSA contributions for 2016 by submitting a Salary Reduction Agreement to their department HR/Payroll and Benefits contact. See the TSA website for more information about enrolling in the program.
If you want to change your TSA deduction for 2016 or enroll in the program, you should submit your TSA Salary Reduction Agreement to your Human Resources/Benefits office in early December. Clearly mark the form as calendar year 2016.
To change your WDC contribution or enroll in the WDC program, call the WDC office at 1-877-457-9327 or visit the website at: http://www.wdc457.org/. WDC changes must be made with Great-West Retirement Services in early December 2015, so that they have adequate time to electronically send the information to the payroll office.
If you want to maximize your TSA and/or WDC contributions for 2016, see the chart below to determine how much to contribute per paycheck.
|
Number of |
2016 Annual Maximum |
2016 Amount per Paycheck |
| 9 paychecks (under age 50) | $18,000.00 | $2,000.00 |
| 9 paychecks (age 50 and over) | $24,000.00 | $2,666.67 |
| 12 paychecks (under age 50) | $18,000.00 | $1,500.00 |
| 12 paychecks (age 50 and over) | $24,000.00 | $2,000.00 |
| 26 paychecks (under age 50) | $18,000.00 | $692.31 |
| 26 paychecks (age 50 and over) | $24,000.00 | $923.08 |
Note: No deductions are taken during the summer for employees paid on an academic year basis (9 paychecks annually).
Source: UW System Administration
Categories: Tax