Compliance
On December 9, 2008, the IRS gave 403(b) plan sponsors a one-year reprieve for adopting a written plan document. A 403(b) plan, also known as a tax-sheltered annuity plan, is a retirement plan for employees of specific tax-exempt organizations such as health care organizations and colleges and universities. While the relief provisions from the IRS give 403(b) a full year to adopt a written plan document, the plans still must operate in compliance with 403(b) plan requirements. If somebody has taken 403(b) plan and his age is less than 59½ then he can not initiate withdrawal from annuity. If he wants to initiate then he has to show triggering event such as financial hardship, disability, or separation from service. The IRS also charges a mandatory 10% as federal taxes on an early withdrawal before it is additionally taxed as ordinary income.
Read more about this topic: 403(b)
Famous quotes containing the word compliance:
“I am not of the opinion generally entertained in this country [England], that man lives by Greek and Latin alone; that is, by knowing a great many words of two dead languages, which nobody living knows perfectly, and which are of no use in the common intercourse of life. Useful knowledge, in my opinion, consists of modern languages, history, and geography; some Latin may be thrown into the bargain, in compliance with custom, and for closet amusement.”
—Philip Dormer Stanhope, 4th Earl Chesterfield (1694–1773)
“In this our talking America, we are ruined by our good nature and listening on all sides. This compliance takes away the power of being greatly useful.”
—Ralph Waldo Emerson (1803–1882)
“This is the day when people reciprocally offer, and receive, the kindest and the warmest wishes, though, in general, without meaning them on one side, or believing them on the other. They are formed by the head, in compliance with custom, though disavowed by the heart, in consequence of nature.”
—Philip Dormer Stanhope, 4th Earl Chesterfield (1694–1773)