2022: Quarter 4 Newsletter
Protecting Your Plan's Confidential Data
When sending information that may include Personally Identifiable Information (PII) or Personal Health Information (PHI), AFPlanServ helps ensure that your data is protected. We may send documents and correspondence to you using Proofpoint secure email, preventing confidential information from being left in an unsecure environment when received. Proofpoint requires you to enter your information, create a password, and answer security questions in order to view the email.
If you prefer, AFPlanServ can continue to fax documents, but please be aware that this is not the most secure option. You may also send documents via paper mail.
Did you know?
If your plan allows an additional catch-up contribution for participants with at least 15 years of service, a maximum allowable contribution (MAC) calculation worksheet must be completed by the participant. This will determine if they are eligible to make the additional contribution up to the maximum of $3,000.00 per year.
A completed MAC calculation worksheet and corresponding salary reduction agreement must be submitted to AFPlanServ for approval, before the change in payroll can be processed. This will need to be submitted by email, mail or fax. Please refer to the AFPlanServ Contact Information section below for fax number and mailing address.
2023 Annual Limits
Effective January 1, 2023, the Internal Revenue Services (IRS) has announced the contribution, deferral, and catch-up limits for retirement savings:
- The contribution limit for employee deferrals into their 403(b) and 457(b) Plans has increased to $22,500 for the tax year 2023, up from the current $20,500 limitation.
- The age 50 catch-up contribution limit for participants in 403(b) and 457(b) Plans has increased to $7,500 for the tax year 2023, up from the current $6,500 limitation.
- The overall limit for defined contribution plans has increased for tax year 2023 to $66,000, up from the current $61,000. This is the limit on contributions from all sources that can impact employer contributions and or mandated sick pay contributions at retirement.
Please be aware of these limits when working with your employees on their 2023 deferral changes. If you have any questions, please contact us.
Billing Reminder
If you elected to pay the AFPlanServ administrative fee (per the Administrative Service Agreement), the payment is required to be provided to your Plan.
The fee applies to all employees who maintain a balance in their 403(b) account, regardless of their employment or contribution status. A payment in full is required.
Payment of all AFPlanServ fee invoices is due within 30 days from the date the invoice is received, unless other arrangements have been approved. Please send either a copy of the invoice with your payment or reference the invoice number on your check. This helps us ensure that your payment is credited correctly. Please refer to the AFPlanServ Contact Information section below for the mailing address.
You do have the option to pass the administrative service fees on to your investment providers, however, this would become a condition for them to remain approved under your Plan. If a provider declines, the Plan will be required to pay the fee in order for the provider to remain approved.
Frequently Asked Questions
Q: Is there a maximum for 403(b) employer contributions?
A: The total employer plus employee contribution limit must be lesser of the Internal Revenue Code (IRC) dollar limit ($66,000 for 2023) or 100% of compensation.
Q: How do I pass the administrative fee to the provider?
A: Send a written request to AFPlanServ, requesting the fee be passed on to the providers in the Plan. AFPlanServ will reach out to the providers to pay.
Plan Reminders
Each year, AFPlanServ provides a Sample Eligibility Notice to help satisfy the Universal Availability requirements.
You may use it as a template for your custom notification or distribute the sample in its entirety. Please check the Operational Guidelines to ensure you adhere to the items listed. If you have any questions, please contact us.
To update the contact information for your Plan, please complete the Employer Contact Form.
If you need more information about your role as the Plan Sponsor, we're happy to help!