The tax-deferred annuity program is available to all Trust Fund employees. There are no age or service requirements. You may enroll for this program at any time.
The tax-deferred annuity program allows you to make contributions to a supplemental retirement annuity on a tax-deferred basis. You will have to pay FICA taxes on your salary deferred in the Plan, but you will pay no income taxes on that amount or the earnings on that amount until you take the money out of the Plan. You may elect to defer a percentage of our salary or a dollar amount each pay check by completing a Salary Reduction Agreement. You may begin having amounts withheld from your paycheck on your entry date, which is the first day of the first pay period beginning after you have submitted a Salary Reduction Agreement. You may change the amount you elect to defer throughout the year, and you may discontinue your contributions at any time.
There are limitations on the amount you can contribute based on the Internal Revenue Code. As a general rule, you cannot contribute more than $18,000 in 2015; however, employees who attain age 50 in 2015 may contribute an additional $6,000 for a total of up to $24,000 to the Plan as salary reduction contributions. These additional contributions that an employee who is age 50 or over may make toward the Plan are referred to as "catch-up" contributions.
After-tax contributions are not allowed through salary reduction.
Investment Sponsor and Options
Your annuity provider is Teachers Insurance and Annuity Association College Retirement Equities Fund (TIAA-CREF). You may select where to invest your salary reduction contributions from among the family of funds provided by TIAA-CREF, which are available under the Plan.
You may change your allocations between TIAA and CREF at any time. You may also transfer funds among the accounts at any time. Once enrolled, you may accomplish this by contacting TIAA-CREF's counseling Center at 1-800-842-2776 or you may set up an account online by visiting www.tiaa-cref.org/smithsonian.
Salary Reduction Agreement and Enrollment
To enroll in the tax-deferred annuity program, you must complete and submit to the SAO Benefits Office (MS17) a signed Salary Reduction Agreement. The Salary Reduction Agreement is your election to defer income from your earnings and this agreement authorizes Smithsonian Institution to withhold from your salary the percentage of your salary or dollar amount you have elected. You may change your election at any time by completing and submitting a new Salary Reduction Agreement to the SAO Benefits Office. This form is available as a form fillable PDF on the HR website under "Forms and Manuals."
Your contributions will be directed to the TIAA-CREF Lifecycle Fund that is closest to the year you are expected to retire (assuming age 65). You will receive a Welcome Letter from TIAA-CREF with important account and personal information, including a beneficiary designation/change form after your first payroll deduction has been made to your tax deferred annuity account.
Once TIAA-CREF has established your account, you may change your investment allocations, transfer existing funds, and name your beneficiaries by logging in to your account online at www.tiaa-cref.org/smithsonian or by calling 1-800-842-2252.
TIAA-CREF has developed an online seminar for Smithsonian Trust Fund employees entitled, Retirement Plans 101. This brief seminar is especially useful for newly hired Smithsonian employees, but it can also serve as a refresher for longer service Trust employees. Check out this online seminar at your convenience.
If you have any questions about the Tax Deferred Annuity enrollment process, please contact the SAO Benefits Office at (617) 495-7371.