403(b) Basics

403(b) plans are special retirement plans for public school employees, and certain tax-exempt organizations.

Distributions are considered taxable income. Distributions are made once there is a triggering event such as you reach age 59½, you suffer a hardship, the plan terminates, or you die, become disabled or sever employment.

Most plans require RMDs (required minimum distributions) to begin at age 70½. If you take any distributions prior to reaching age 59½, you may be subject to a 10% penalty from the IRS unless an exception applies.

Loans may be taken from a 403(b) if the plan permits it. Withdrawals for loans are not usually taxable but your plan administrator can tell you whether your plan meets the criteria allowing you to take a loan without triggering a taxable transaction.


More Updates


For trusts that inherited an IRA in 2019, an important deadline is approaching. The due date to provide required trust documentation to the IRA custodian to ensure that the longest payout period possible is available for the inherited IRA is October 31, 2020. Generally, only individuals who are named on an IRA beneficiary form can

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The coronavirus-related distribution (CRD) rules for Roth conversions have a gaping hole. An “affected person” (as we have defined in previous blogs), is entitled under the CARES Act to withdraw up to $100,000 from their IRA or workplace retirement plan. A CRD avoids the 10% early distribution penalty for those under 59 1/2, can be

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Rolling Over an RMD

Like most people’s lives, the retirement world is upside down. This is made evident by a single statement: “Required minimum distributions (RMDs) can be rolled over.” Yes, that is the new normal—at least for this year. RMDs are considered the first money out of an IRA and workplace plan. Typically, these dollars are ineligible to

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