Participants who wish to transfer their 403(b) account must complete certain documents to initiate the transfer between their current provider and the new provider.  These documents are usually supplied by the new provider.  The new IRS regulations require the new provider to have a formal relationship with the employer to avoid adverse tax consequences for the participant.  Specifically, if the new provider does not enter into an information sharing agreement (ISA) with the employer or is not listed as a provider in the employer’s plan document on January 1, 2009, the participant’s transferred account would then be 100% taxable. 

A standardized ISA has been sent to each of your current authorized providers for their acceptance and signature.  When these providers return their ISA, we place a symbol by their name on your vendor pages at www.tsacg.com.  We have not recommended entering into an ISA with any provider that is not currently an authorized provider for your plan.

Most providers have addressed these new transfer rules by requiring the employer to approve the transfer, indicating that an ISA exists with the new provider.  As your designated administration services provider, we recommend that you direct all such requests to our office.  We are including an instruction sheet that you may wish to provide to participants and/or representatives who are requesting a transfer.  Our staff will assist in the communications to the participant and the provider and facilitate the transfer in the most effective manner possible.

Please be advised that we do not recommend transfers to providers that have not entered into an ISA with the employer.  In the event that a participant demands a transfer regardless of the ISA, we will require signed transfer disclosure acknowledgement in order to process the transfer.  We have included a link to the transfer disclosure acknowledgement form for your review.

Please contact us with any questions or comments you may have.

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403(b) Transfer Instructions

1.  Identify the company intended to receive the transfer (Receiving Company). 

2.  Check to make sure the receiving company has accepted and executed your employer’s Information Sharing Agreement (ISA) by checking for an “ISA” symbol by the provider’s name on the vendor list for your employer.

https://www.tsacg.com/employee_site/employee_site_main.htm

STOP.   In the event that the receiving company does not have an ISA with your employer, the transfer may subject your 403(b) account to adverse tax consequences.  Please see the “Transfer Disclosure Acknowledgement” posted at the following location:

Download: Transfer Disclosure Acknowledgement Form


PROCEED if you have determined that the receiving company has an ISA with your employer.

3.  Employee must include a Transaction Routing Form to facilitate the processing of the transfer paperwork provided by the 403(b) Company or Agent.  

Download: Transaction Routing Request Form

4.  Mail or Fax all transaction request documents (company forms and the Transaction Routing Form) to the address below for verification and signatures for processing (Recordkeeping):

TSA Consulting Group, Inc.
Attn:  Recordkeeping Department
15 Yacht Club Drive NE
Fort Walton Beach, FL  32548
Fax:  1-866-741-0645

Hardships and Financial Emergency

Click here to download the Rules for Hardship Withdrawal.

Click here to download the Hardship and Rollover Withdrawal Form.

Click here to download the 457(b) Financial Emergency Form.

Questions and Answers
All information copied verbatim from the "403(b) Answer Book" -Sixth Edition
Authors: Donald R Levy, Barbara N. Seymon-Hirsch, Janet M Anderson

Q10:46 When can the exception for "substantially equal periodic payments" be used?

The exception for substantially equal periodic payments is available only if the participant terminated employment prior to beginning the periodic payments. A second requirement is that the payments cannot be substantially modified either before the participant attains age 59 1/2 or before five years have passed since payments began after attaining age 59 1/2. 

IRS Notice 89-25 describes three methods that will satisfy the requirements of substantially equal payments. "The first method provides that the annual payment may be calculated in the same way minimum distribution payments under Code Section 401(a)(9) are calculated. The second method provides for the calculation of an annual payment by amortizing the account balance and using a reasonable interest rate, over the life or joint life expectancies of the participant and designated beneficiary, if any. The third method provides for the calculation of an annual payment by dividing the account balance by an annuity factor derived using reasonable mortality factors and interest rates.

Q10:47 Must the employee have attained age 55 prior to separation from service in order to take advantage of the exception for payments made after separation from service?

Under IRS Notice 87-13, the exception is available if (1) it is made after the employee has separated from service for the employer maintaining the plan and (2) such separation from service occurred during or after the calendar year in which the employee attained age 55. This is a slight expansion of the statutory language, which requires that the separation occur after attainment of age 55.

Q10:48 What constitutes disability?

Individuals are considered disabled if they are unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or to be of long-continued and indefinite duration. [See IRC § 72(m); Treas Reg § 1.72-17A(f)]