The Deferred Compensation Plan

Important information with regard to Plan Loans

On March 27, 2020 the CARES (Coronavirus Aid, Relief, and Economic Security) Act was signed into law to address economic impacts associated with COVID-19.

1. Due to the financial impact of COVID-19, the CARES increases the maximum loan amount to $100,000 (currently $50,000) and permits loans of 100% (currently 50%) of the present value of the participant's account. To determine if you qualify for a Coronavirus-Related Distribution, please visit the COVID-19 resource page.

2. The CARES Act also allows a qualified individual with an outstanding loan from the 457 Plan or 401(k) Plan to extend the due date for any loan repayments that occur during the period March 27, 2020 - December 31, 2020.

Please visit the COVID-19 resource page for more information, including special CARES Act forms.

Note:  The following video does not reflect the changes included in the CARES Act.

Withdrawing Assets

Participants should attend a free Retirement Planning Seminar before submitting a distribution form.  



Any active employee who is a participant in either the 457 or 401(k) plan is eligible to apply for a loan if the plan for which the loan is taken has an account balance of $5,000 or more at time of application. 401(k) Roth accounts are not available for loans.


Loans are funded directly from a cash-out of the participant's pre-tax contributions in his/her 457/401(k) Plan accounts. The withdrawal will be deducted proportionately from all funds in the participant's account. Loan payments are made with after-tax dollars and are applied to the interest and finally to the principal, thereby reducing the balance owed. Loan payments received will be invested in the same manner as the participant's current investment allocation in the applicable Plan and will be reflected on the participant's statement.


Before deciding to take a loan from the Deferred Compensation Plan, a participant should make sure they understand how taking a loan can affect his/her retirement savings. Taking a loan from his/her Deferred Compensation Plan account can greatly impact ones future account balance. Therefore, a participant should consider other ways to cover unexpected expenses.


The minimum loan amount available from either the 457 or the 401(k) Plan is $2,500.

The Maximum Loan Amount a participant may obtain is the lesser of:

1. One-half of the account value in the 457 or 401(k) Plan (i.e., account balance minus current outstanding loan balance in the 457 or 401(k) Plan); or
2. $50,000 reduced by the highest outstanding balance of loans from all qualified employer plans of the same employer during the 1-year period ending on the day before the date on which such loan is going to be made.


Participants can calculate loan projections to estimate their loan repayment amount online (after signing into the account and selecting "Obtain Loan Quote" from the menu) or through KeyTalk® by calling (212) 306-7760. These projections will not take into account any outstanding pension or TDA loans a participant may have.


There is a loan origination fee in the amount of $50.00 which will be deducted from the loan amount approved and a quarterly maintenance fee of $8.75 which is deducted from the participant’s account.


Participants wishing to apply for a loan must complete a Loan Application and submit it to the Plan’s Administrative Office. 



For additional information, and an application, download the Plan's Loan Guide, available from the Forms and Downloads section of this website.




Learn about distribution options for participants who are severing City service
Learn about in-service withdrawals
Register to attend a Retirement Planning Seminar