Each year the Internal Revenue Service issues limits on the amount of voluntary contributions an individual can make.
- The maximum voluntary contribution level for both 2013 and 2014 is $17,500 for faculty and staff under 50 years old, and $23,000 for those 50 and older.
This limit applies to all elective contributions made by a participant to the Vanderbilt University Retirement Plan aggregated with any other employer-sponsored plan. For the Vanderbilt University Retirement Plan, elective contributions include your basic and supplemental amounts, and do not include the mandatory or match amounts.
Section 415(c) of the Internal Revenue Code
To help employees avoid taxes and penalties, HR collects information each spring regarding contributions made to outside retirement plans to help ensure they don't exceed IRS limits. Those who contribute to a non-Vanderbilt retirement plan through outside businesses in which they are at least a 50 percent owner must complete the 415(c) Aggregation Form . This form collects information relevant to Section 415(c) of the Internal Revenue Code.
To find out if this applies to you, answer these questions:
- Are you eligible to participate in the Vanderbilt University Retirement Plan?
- Do you own a controlling interest (more than 50 percent) in a for-profit business, including sole proprietorship and/or consulting?
- Do you contribute to a qualified retirement plan – such as a 401(k), 401(a) or 403(b) plan – or simplified employee pensions (SEPs) and Keogh plans through that business?
If you answered "yes" to all three questions, please complete and submit the Internal Revenue Code Section 415(c) Aggregation Form to HR no later than April 1 for each year that this applies. While you are responsible for reporting your retirement contributions to the IRS, by collecting this information HR may be able to help you avoid taxes and penalties.
See the IRS website for more information about Section 415.