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The Deferred Compensation Plan
Deferred Compensation News
Important:
The cutoff for distribution forms to be received in order to be processed for 2023 was 12/08/2023. The last date for an online distribution to be processed for 2023 is 12/27/2023 before 4pm..
Contribution Limit Increases in 2024
Each year, the Internal Revenue Service sets limits on the amount of wages that can be deferred. These limits are tied to inflation statistics, which are recalculated each fall for the following calendar year. Employees can defer the maximum in both the 457 and the 401(k) plan.
| 457 Plan |
2023 |
2024 |
| Regular Contribution Limit | $22,500 |
$23,000 |
| Age 50 and Over Contribution Limit | $30,000 |
$30,500 |
| DAR (Catch-up) Contribution Limit | $22,500 |
$23,000 |
|
|
||
| 401(k) Plan | 2023 |
2024 |
| Regular Contribution Limit | $22,500 |
$23,000 |
| Age 50 and Over Contribution Limit | $30,000 |
$30,500 |
Attention Public Safety Workers - A new strategy may help you save taxes
Thanks to the Pension Protection Act of 2006 (PPA) and the Defending Public Safety Employees’ Retirement Act signed into law in June 2015, effective January 1, 2016, public safety workers age 50 or older who retire or separate from City service are exempt from the 10% early withdrawal tax. This includes distributions from the 401(k) and the 401(a) plans, effective after December 31, 2015 (Defending Public Safety Employees’ Retirement Act of 2015).
Public safety employees include employees who provide:
- Police Protection
- Firefighting Services
- Emergency Medical Services
You can claim the exemption by filing IRS Form 5329, Additional Taxes on Qualified Plans (including IRAs) and Other Tax-Favored Accounts, with your Federal tax return. Consult your tax advisor to determine if you are eligible.
Quick Summary: When does the 10% Penalty Apply
| PLAN |
Under |
Age |
Age |
59 1/2 |
| 457 |
No |
No |
No |
No |
| 401(k) |
Yes |
No (1) |
No |
No |
| 401(a) |
Yes |
No |
No |
No |
| Traditional NYCE IRA |
Yes |
Yes |
Yes |
No |
(1) Effective for distributions after 12-31-2015
Learn more about Your Contributions
2023 Year End Reminders - Understanding your Form W-2 and more...