457 FICA Alternative Retirement Plan
What is the Somerset ISD FICA Alternative Retirement Plan?
The Somerset ISD FICA Alternative Retirement Plan is a 457(b) deferred compensation, defined contribution plan for all part-time, temporary and seasonal employees, including substitutes. The Omnibus Budget Reconciliation Act of 1990 (OBRA 90) partially resulted in Internal Revenue Code, Section 3121(b)(7)(f) to allow certain employees of governmental entities the ability to contribute to a retirement plan in lieu of Social Security.
What are the advantages of the Somerset ISD FICA Alternative Retirement Plan?
You are deferring pre-tax dollars to a retirement plan where you are 100% vested.
Pre-tax deferral means that your take-home pay will remain about the same compared to an after-tax deduction to Social Security.
Should you become an eligible member of the Teacher Retirement System of Texas (TRS), you can purchase service credit with your account balance.
If you stop working for Somerset ISD, you are eligible to roll your account balance over to an IRA or another qualified retirement plan, or receive your account balance in cash subject to taxation.
Because your retirement savings is in a 457(b) Plan, there is no IRS early distribution penalty for taking a cash distribution prior to age 59½.
Who is required to participate in the Somerset ISD FICA Alternative Retirement Plan?
All employees who are not eligible to participate in the Teacher Retirement System of Texas are required to participate. Enrollment is both mandatory and automatic.
How much do I contribute to the Somerset ISD FICA Alternative Retirement Plan?
A 7.5% pre-tax contribution will be automatically deducted and sent to the Plan. This is approximately equal to a 6.2% after-tax deduction to Social Security.
Where are my contributions sent?
The Somerset ISD FICA Alternative Retirement Plan is held in a diversified portfolio, administered by TCG Administrators.
How do I designate a beneficiary?
If the employee dies while a participant in the Plan, the account balance will be distributed to the employee’s beneficiary. If the employee is married at the time of death, the spouse is automatically the beneficiary. If the employee wishes to designate someone other than the spouse as beneficiary, the employee must do so in writing and the spouse must sign a spousal consent form. If the employee is unmarried at the time of death, the account balance will be paid to the employee’s estate unless another beneficiary has been designated.
If you would like to change your beneficiary, please contact the Plan Administrator, TCG Administrators at 457@tcgservices.com or call toll free: 800-943-9179.
How do I find out my account balance?
To find out your account balance you can login to your account at www.region10rams.org or please contact the Plan Administrator, TCG Administrators, at 457@tcgservices.com or call toll free: 800-943-9179.
How do I request a distribution?
To request a distibution you can login to your account at www.region10rams.org or please contact the Plan Administrator, TCG Administrators, at 457@tcgservices.com or call toll free: 800-943-9179.
If you are eligible, please download and complete the FICA Alternative Plan 3121 Distribution Form found below. The form is sent directly to TCG Administrators and not able to be processed by the Somerset ISD HR Department.
Do I still contribute to Medicare?
Yes. You will still participate in Medicare in addition to the Somerset ISD FICA Alternative Retirement Plan.
Plan administered by:
900 S. Capital of Texas Hwy., STE 350
Austin, Texas 78746
(800) 943-9179
www.region10rams.org