Human Resources

Human Resources

Deferred Compensation - Section 457 - Pre-Tax

The City provides all benefited employees the opportunity to participate in a Section 457 Deferred Compensation plan. Deferred Compensation allows participants to defer a portion of their salary on a pre-tax basis, for investment purposes. Effective July 1, 2017, ICMA-RC is the City's sole Deferred Compensation Provider. Employees have a variety of investment options in all risk categories.

Important Change: Effective July 1, 2017, the City will transition to a sole Deferred Compensation provider.  ICMA-RC has been selected as the sole provider for the City of Riverside 457 Deferred Compensation plan.  All existing accounts with Empower Retirement for current employees and retirees will be transferred to ICMA-RC.  Please visit the ICMA transition website for more details:  http://www.icmarc.org/riversideca.html

Deferred Compensation is not a savings account. Under IRS Section 457, distributions can only be made at termination, retirement, or unforeseeable emergency.

  • The deferred compensation committee must review all unforeseeable emergency claims.
  • The City MUST abide by IRS regulation or risk forfeiting the entire Deferred Compensation plan.

     ICMA-RC 

IRS Section 457 Plan Highlights

  1. Enrollment is continuous - participants can enroll, stop and change at any time.
  2. The minimum contribution is $10.00 per pay period.
  3. The maximum allowable contribution under the IRS for calendar year 2017 is $18,000 per year ($24,000 per year if employee turns 50 years or older in the calendar year).
  4. The City may contribute a specific amount for employees in certain bargaining units. If participant has a pre-tax and after-tax account, the City contribution will go towards the pre-tax account, unless the employee requests otherwise.
    1. The City contribution for Executive, Elected Officials, Management I/II and Confidential employees is $75/month and employee must contribute at least $12.50 per pay period.
    2. The City contribution for IBEW Supervisory employees is $250/month and the employee must contribute at least $25.00 per pay period.*
    3. The City contribution for Fire-safety Management employees is $210/month and employee must contribute at least $25.00 per pay period. City contribution is $200/month, if enrolled in LTD.*
    4. The City contribution for Police-safety Management and Supervisory employees is $215/month and the employee must contribute at least $25.00 per pay period. City contribution is $200/month, if enrolled in LTD.*
    *Premiums for Long-Term Disability are paid out of the City's contribution to deferred compensation
  5. Balances in 457 accounts through previous employers may be transferred to the City. Effective January 1, 2002, plans such as 401(a), 401(k), IRA and 403(b)  are compatible with 457s under the IRS code and can be rolled over to a 457 plan.

Deferred Compensation enrollment packets contain complete details of benefits and exclusions. The City of Riverside Human Resources Department and ICMA-RC Member Services are also available to answer questions.

If you have additional questions regarding the 457 plan, please contact ICMA-RC Member Services at (800) 669-7400. Also, the Human Resources Benefits Division is available at 951-826-5639 to answer benefit questions.

 

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Printed from: http://www.riversideca.gov/human/benefits/benefit-defcomp-457.asp