403(b) Transactions Information

Obtaining Transaction Authorization

CCC offers Plan Administrative Authorizations for plans CCC administers in various formats, depending on the transaction type.

Vouchers are available to authorize the most common transaction types:

• 403(b) Distributions to the Participant (for qualifying events of Severance from employment and attainment of age 59.5)*
• 403(b) Rollover Distributions (for qualifying events of Severance from employment and attainment of age 59.5)*
• 403(b) Contract Exchanges within the Plan*
• 403(b) Plan-to-Plan Transfers out of the Plan

Click here to Request a Voucher.

*Special note to current contributors to the 403(b) plan wishing to distribute or exchange their full account balance: If you do not wish to continue contributions to your account, you need to complete a new Salary Reduction Agreement (SRA) to cancel 403(b) deferrals. This is available from your employer's page, which linked from CCC's Home Page.

Click here for information on submitting 403(b) Loans and the required CCC Loan Request Form.

Click here for information on submitting 403(b) Hardship Distributions and the required CCC Hardship Form.

For all other transaction types

Participants may request plan authorization by completing the following steps:

• Complete a CCC Transaction Submission Cover Sheet and submit it, along with your completed Vendor Transaction Forms, to CCC using one of the following methods (upload and fax are preferred for both speed and security):
  
  
• Securely upload the documents to CCC,


• Fax to: (833) 895-7836, or


• Mail to:
  
  Carruth Compliance Consulting 6975 SW Sandburg Rd., Suite 320 Tigard, OR 97223
  

The CCC Transaction Submission Form is to be used to submit any transaction type except 403(b) Loans and 403(b) Hardships, which have a unique CCC Forms.

A note concerning processing times: CCC's processing time may be affected by holiday closures, overall transaction volume, as well as the due diligence, and follow-ups required on the specific transaction.

Receiving Secure Emails: CCC sends emails containing sensitive information (such as Vouchers or Transaction documents) via a secure email service called Sendinc from the email address "ccc-transactions@ncompliance.com". Please check your spam folder if you do not see the anticipated message in your inbox. The secure email service will require you create an account the first time you use it, more info/support is available on the Sendinc Website.

Information Concerning Rollover Options and the Taxation of Distributions

When taking a rollover or distribution from a 403(b) or 457(b) account, one must consider all options available to them and the tax consequences associated with those options. Most vendors provide a notice called a "402(f)" that describes the various rollover options and the applicable taxes associated with distributions and rollover options that comes as a part of or addendum to the vendor's distribution and rollover forms. Usually the participant's authorization section of one of these forms requires the participant to attest to the fact they have read the notice pertaining to taxation and understand the applicable tax consequences of the transaction they are submitting. (Please note: the IRS provided generic model language for 402(f) Notice in 2009 (Notice 2009-68), this model language is viewable here.) CCC strongly encourages participants to seek the advice of a qualified and trusted financial advisor and/or tax consultant concerning investment and distribution choices.

General Information Regarding Transactions

Carruth Compliance Consulting (CCC) serves as Third Party Plan Administrator (TPA) for Employer’s sponsoring 403(b) Plans. In this role CCC provides transaction processing for our clients. CCC conducts the appropriate due diligence required to determination eligibility for a given transaction prior to authorization.

Before you submit a transaction to CCC, please note the following information regarding transactions:

• Transaction may be restricted by a vendor’s investment agreement
• All transactions are subject to their availability as an “optional feature” under the 403(b) Plan Document(s) for the Employer(s) associated with a transaction.
• Transactions may be subject to taxes, early withdrawal penalties, and potential fees specific to your investment contract. It is prudent to understand these impacts and how these implications may change over time when initiating a transaction.
• All transactions are subject to meeting established requirements, see below for additional information.

Exchanges and Transfers: Transaction Definitions and Requirements

Contract Exchange: A Participant’s 403(b) Account Assets under an Employer’s plan are moved to a new or existing 403(b) account under the same Employer’s 403(b) plan.
Requirements: The receiving Vendor must be a Vendor that is eligible to receive exchange and transfers in the Employer’s plan.

Plan to Plan Transfer OUT of the Plan: Funds in a 403(b) Account associated with an Employer (the “releasing” plan) are moved to another Employer’s 403(b) plan (the "receiving" plan). Note: The account may remain with the same Vendor (referred as an "internal transfer") it may be moved to another Vendor available to receive transfers in the new Employer’s plan. The funds transferred to the "receiving" Plan are subject to that new plan's distribution requirements/restrictions. This transaction type is often used by annuity providers as an "internal transfer" to preserve the original investment contract conditions while associating the account with a new employer.
Requirements: See above, note that if an employee has severed employment with the releasing employer they may choose to Rollover their account vs. Transfer the account. For further information, please read this article on the important differences between Plan to Plan Transfers and Rollovers.

Permissive Service Credit Transfers: Funds in a 403(b) account are transferred to the State Retirement Plan for the purpose of purchasing service or waiting time.
Requirements: Participant must provide documentation from the State Retirement Plan detailing the amount needed to purchase service or waiting time, along with any transaction documents required to facilitate the transfer of funds, for the Plan Administrator to provide authorization.

Distributions: Transaction Definitions and Requirements

Distributions OUT of the Plan: A Participant withdraws the funds in a 403(b) account and directs the payment to his/herself or rolls the account over to another eligible retirement account.
Requirements: A single Qualifying Event must occur to for a Participant (or in the event of death, the beneficiary or beneficiaries) to distribute the funds. These events include:

• Attainment of Age 59 ½
• Severance from Employment Severance is defined as a complete severance from any employment relationship with the Employer sponsoring the 403(b) plan.
• Disability (Disability in this context is defined as the inability to participate in gainful employment of any type due to a disability or illness that is of an indeterminate length and/or will result in the Participant’s death (official documentation of the disability, duration and work status required) ).
• Death (See below for additional information).

The IRS has Rollover Chart that explains the various allowable options for rolling monies in or out of the plan, available here.

Required Minimum Distribution (RMD)

Required Minimum Distribution (RMD) are transaction type that retirement plan account owner must initiate when they reach a certain age*. The minimum amount that must be withdrawn annually based upon a calculation that takes into account the participant's account balance and their anticipated life expectancy (detailed explanation available here).

Beginning in 2023, the age for first RMD is now 73 per changes introduced in the SECURE 2 Act. What does this mean? If you reached Age 73 or better in 2023, your very first RMD is due by April 1 of the following year, subsequent RMDs will be due by December 31 of the given year. CCC has also provided examples below.

You reached age 73	February 1, 2023
The deadline to take your first distribution:	April 1, 2024**
Your second RMD distribution deadline:	December 31, 2024
Your distribution deadline for future RMDs:	December 31st
**Note: If a participant wishes they may take their first RMD early:	**You may choose to distribute by December 31, 2023 to avoid having to 2 RMDs in 2024.

*There's an potential exception to this rule, depending on the Plan' rules: If you're still working, you can generally delay RMDs, but only from the retirement plans you participate in with your current employer. In these situations, your first distribution must be made by April 1 of the year following the year of your retirement.

Note: Distributions from section 403(b) contracts do not satisfy the minimum distribution requirements for IRAs, nor do distributions from IRAs satisfy the minimum distribution requirements for section 403(b) contracts. If you don’t take any RMDs, or if the distributions are not large enough, you may have to pay a 50% excise tax on the amount not distributed as required. Beginning in 2024, RMDs are NOT required from designated Roth Accounts The IRS has posted a very detailed RMD primer here for the most detailed information

Rollover Distribution OUT of the Plan: A Participant withdraws the funds in a 403(b) account and directs the payment to another qualified retirement plan. Note: The account may remain with the same Vendor (referred to as an internal rollover) or it may be moved to another Vendor.
Requirements: Same as a Regular Distributions OUT of the Plan (see above).

Death Beneficiary Claim: A Beneficiary of a 403(b) account moves the account assets from a deceased Participant in an Employers plan into the beneficiary's name, by rolling the funds into another qualified retirement plan or directing the distribution to his/herself.
Requirements: A copy of the deceased Participant’s death certificate must be provided and the Beneficiary information must be verified with the Vendor.

Hardship Distribution: Please see our dedicated "Hardship Distribution" link in the left-hand navigation menu or click here for information on Hardship Distributions and the required CCC Hardship Form.

Distribution of assets via QDRO (Qualified Domestic Relations Order): Please see our dedicated "QRDO" link in the left-hand navigation menu or click here for information.

Qualified Birth or Adoption Distribution:Changes as the result of Secure (enacted in 2019) now allow for participants may take a Qualified Birth or Adoption Distribution of up to $5000 GROSS DISTRIBUTION (total under all employer plans under all of the participant's employers) within one year of a child’s birth or adoption beginning in 2020. In cases of adoption, an "eligible adoptee" defined as any individual (other than child of the Participant's spouse) who has not attained 18 or is physically or mentally incapable of self-support. Employees may repay this distribution to their account within 3 years of taking the distribution (this repayment will be considered a rollover contribution into the account). The early withdrawal penalty on early distributions does not apply to Qualified Birth or Adoption Distributions. The Plan Document will be amended retrospectively for this change by 12/31/2026, the deadline for changes in governmental 403(b) and 457(b) plans (non- governmental plans must be updated by 12/31/2025).

Note the following re: Qualified Birth or Adoption Distribution tax withholding:

• The default withholding for Federal taxes is 10%
• The default withholding for State taxes, where applicable
• An employee can opt to wave withholding of Federal or State tax from the distributions by filling out the appropriate vendor documentation
• The max distribution amount ($5000) may not be grossed up to cover taxes.

CCC has created a supplemental questionnaire to capture the employees’ self-certification the distribution conditions are met and we have collected the required data per IRS guidance: 403(b) and 457(b) Qualified Birth or Adoption Distribution Supplemental Questionnaire.

Loans: Transaction Definition and Requirements

Loans: Please see our dedicated "Loans" link in the left-hand navigation menu or click here for information and the required CCC Loan Form.

Types of Contributions

Employee Elective Deferrals (via Salary Reduction): An employee establishes a 403(b) account then begins making contributions by requesting part of their salary be deferred to the account by reducing their pre-tax salary by an elected amount.
Requirements:A Salary Reductions Agreement (SRA) must be submitted to the Employer along with documentation that the account has been established with a Vendor with an Active Payroll Slot under that Employer's 403(b) plan. The SRAs and the 403(b) List of Vendor is available Employer's dedicated page (accessible from the "Employee Entrance" link at the top of the page.)

Plan to Plan Transfer INTO the Plan: This is the "receiving" side of a Plan to Plan transfer (above).
Requirements: The accountholder must be an eligible participant in the receiving plan and the vendor receiving funds must be eligible for transfers under the Plan. Funds transferred into a Plan via Plan To Plan Transfer are subject the receiving Plan's distribution rules .

Rollover Contributions into the 403(b) Plan: A participant withdraws the funds from a qualified retirement plan (IRA, PERS, 457(b), 401(k), etc.) account and directs the payment into a 403(b) account sponsored by his/her Employer. Note: The account may remain with the same Vendor (referred to as an internal rollover) or it may be moved to another Vendor. The vendor must track the "rolled in" amounts separately from other contributions to the receiving account so those "rolled in" funds maintain their ability to be distributed without restriction.
Requirements: The participant must have established the receiving account while employed by the sponsor of the receiving plan. The receiving vendor must be a vendor that is eligible to receive exchange and transfers in the employer’s plan.

The IRS has Rollover Chart that explains the various allowable options for rolling monies in or out of the plan, available here.