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New Roth 457 Option Planned

We are currently in the development phase to offer a Roth 457 option.

As development progresses, we’ll provide additional information, but we want to let you know a few important details now in response to your most common questions:

  • Roth IRA rollovers are not permitted to a Roth 457 option based on current IRS regulations
  • Traditional pre-tax assets will not be able to be converted to Roth assets
  • The Roth option will only be available to employees of employers who elect to offer the Roth option

Below is a comparison of the traditional pre-tax option and the Roth post-tax option:

Feature Traditional 457(b) Roth 457(b)
Payroll Deductions Yes Yes
Contributions Pre-tax dollars After-tax dollars
2019 Annual Limits $19,000 ($25,000 if age 50+, $38,000 for Special Catch-up)
Combined contributions to Traditional and Roth plans must remain below the annual limits
Investment Growth Accumulates tax-deferred Accumulates tax-free
Federal Tax on Distributions Taxable income Tax free if certain criteria are met*

* Tax free starting at age 59 ½ and if there were no withdrawals within five years of the first contribution.

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