403(b)

Before you get started

A 403(b) is a tax-advantaged retirement plan for employees of public educational organizations, nonprofit organizations qualified under Internal Revenue Code section 501(c)(3) and churches. Consider talking to your financial professional before performing financial transactions. They can offer advice and help you make decisions that support your long-term financial plan.

• Participants with a Capital Bank and Trust Company (CB&T) Basic 403(b) account can view and update their personal contact information online. Changes to contribution amounts should be referred to the employer or plan administrator.
  
  
• Participants in an employer-sponsored retirement plan must visit their plan-specific website to log in to their account. Use your plan ID to determine the appropriate URL to access your account
  
  
  • If your plan ID begins with IRK, BRK or 2, visit americanfunds.com/retire
  • If your plan ID begins with 34 or 135, visit myretirement.americanfunds.com

403(b) account updates

Participants of CB&T Basic 403(b) accounts can log in to:

• Update personal information, including the mailing address, phone number and email address on the account
• Exchange or rebalance shares within the account
• Download and print quarterly statements

To change the beneficiary(ies) listed on the account, complete the 403(b) Beneficiary Designation form (PDF)

403(b) contributions

Contributions into a participant’s 403(b) account represent employee elected salary deferrals and discretionary employer contributions.

• In 2024 , for salary deferral contributions, participants in a 403(b) can contribute up to $23,000 or $30,500 for those age 50 or over
• Plan participants who have worked 15 or more years for the same organization may be able to contribute an additional amount. Consult a tax advisor for more information.
• CB&T Basic 403(b) accounts do not accept Roth contributions
• You do not receive tax forms for contributions made into CB&T Basic 403(b) accounts

403(b) distributions

Most distributions from 403(b) accounts require employer authorization

Plan participants can take a distribution from their 403(b) account if any of the following qualifying events occurs:

• Participant reaches age 59½
• Separation from service
• Permanent disability*
• Death*
• Qualified Domestic Relations Order (QDRO) (divorce)*
• Plan termination*
• Birth or adoption* (The participant must ask the employer if the plan offers this distribution event.)
   

Distributions that are eligible to be rolled over have a mandatory 20% federal tax withholding requirement unless the assets are directly rolled over into another qualifying retirement plan

The total amount of distributions, including any federal or state income tax withheld, are reported on Form 1099-R, available in late January

To request a qualified distribution from a CB&T 403(b) account due to separation from service or reaching age 59½, complete the 403(b) Single Distribution Request (PDF), including employer authorization

* Contact us or your financial professional for distribution forms and requirements related to these events.

403(b) required minimum distributions (RMDs)

• 403(b) accounts are subject to RMDs. Investors are generally required to withdraw a minimum amount from their account(s) annually starting no later than April 1 of the year after they reach age 73* or when they retire from employment from the employer maintaining the plan (whichever is later).
• The IRS requires investors take their RMD amount each year by December 31. You can delay taking your first distribution until April 1 of the year after you reach age 73.* If you wait, you’ll have to take two distributions in that same year: the prior year’s RMD by April 1 and the current year’s RMD by December 31.
• To request an RMD from a CB&T 403(b) account, complete the Required Minimum Distribution (RMD) Request (PDF)
• As part of the SECURE 2.0 Act, effective in 2024, investors with Roth 403(b)s will no longer be required to take lifetime RMDs from those accounts. Investors must still take 2023 RMDs, including those with a required beginning date of April 1, 2024.
   

* The SECURE 2.0 Act increased the age when RMDs must begin from 72 to 73, effective for individuals turning 72 on or after January 1, 2023. If you reached age 72 before this date, you are still required to take RMDs.

403(b) exchanges and rollovers

Participants in CB&T Basic 403(b) accounts can exchange between available American Funds and/or rebalance the funds in their account online.

Movements of assets from an account at another vendor to a 403(b) account within the same plan (or same employer) are treated as an exchange.

A rollover is the distribution and subsequent deposit of assets from any retirement plan or IRA to a 403(b) plan (or another retirement plan). Contact your employer or plan sponsor to confirm if your plan accepts rollover contributions.

Note: For information on moving assets to or from another vendor within the same plan (or same employer) or rolling over assets into another retirement plan, contact us or your financial professional.