Catch-up contributions allow you to put in additional funds, over the maximum elective deferral limit. The 403(b) and Governmental 457(b) Plans also offer different types of additional catch up contributions. In order to make catch up contributions, you must meet certain requirements. Read more below for details about eligibility.
Age 50 Catch Up
If permitted by the Plan, an additional $6,500 per year for 2021 ($6,500 for 2020) can be contributed to a 403(b) and 457(b) Plan if you are age 50 and older at any time during the calendar year.
15-Year Rule for 403(b) Plans
If permitted by the Plan, an additional $3,000 per year can be contributed if:
- You have 15 years of service with your current employer
- Your annual average contribution is less than $5,000 per year
- You complete a Maximum Allowable Contribution (MAC) calculation worksheet, which is approved by the Plan
There is a lifetime maximum catch up of $15,000 under the 15-year rule. If you are eligible for both the age 50 catch up and the 15-year rule, contributions above the regular limit must be applied first to the 15-year rule.
Last 3 Years Rule for 457(b) Plans
If permitted by the Plan, for the 3 years prior to attaining the Plan's normal retirement age, you may contribute the lesser of:
- Twice the annual limit ($39,000 in 2020; $39,000 in 2021)
- The regular annual limit plus the amount of the additional regular limit not used in prior years.
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