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Human Resources

Retirement Investors' Club (RIC) 403b Program

Distributions While Employed

Options for distributions while employed are limited to the following conditions:

For tax information on distributions, see the Special Tax Notice.

Hardship withdrawal

The hardship withdrawal provision may allow you to withdraw funds from your 403b employee contribution account due to an "unforeseen" emergency if you meet strict federal guidelines. Some inactive providers may have fees for distribution. To apply for a hardship withdrawal, complete your provider's Financial Hardship Form.

Situations that might qualify for withdrawal:

  • uninsured medical expenses & related lost wages
  • funeral expenses (legal dependent)
  • purchase of main residence
  • education costs for you or a dependent
  • uninsured damage to primary residence
  • foreclosure of or eviction from residence

If your application is approved, the distribution is taxable as ordinary income. You will be required to stop contributions to the Retirement Investors' Club (RIC) for at least six months after an approved distribution.

You are not eligible to receive a payout from your RIC 403b account for any of the following:

  • warding off bankruptcy
  • divorce
  • overdue bills
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Age 59 1/2

You may begin to take distributions from your accounts at age 59 1/2 even if you are still employed. You can elect to receive the entire value of your account or you may receive partial lump sums, periodic payments in a variety of ways including lifetime payments, or rollover to another eligible plan. Please consult your investment company's representative to determine what payment options are available in your investment.

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Age 70 1/2

The federal government has established rules for pretax plans like the RIC 403b account that apply when participants reach age 70 1/2.

Your provider will calculate your required minimum distribution amount upon request. You may elect to receive the entire value of your account, a portion of your account (not to be less than your required minimum distribution amount, or you may receive periodic payments over your life expectancy. If you do not elect a lifetime payment option, you have the option to take more than your required minimum amount at anytime.

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Purchase IPERS credits

IPERS must determine your eligibility to purchase service credits. If you are eligible, you may request to transfer money from your RIC 403b employee contribution account to IPERS for the purchase. This is a non-taxable transfer. Other tax-advantaged accounts such as IRAs, 401(k)s, 457s, etc., may also be options for funding an IPERS purchase.

To explore the possible benefits of purchasing IPERS credits, review Why Purchase Service? on the IPERS website. To determine your eligibility to purchase credits, review How to Purchase Service or contact IPERS toll free at 800-622-3849 (281-0020 in Des Moines) or email them at Info@ipers.org.

If IPERS approves your request to purchase, they will send you a cost quote. You may request to rollover your RIC 403b money to make the purchase.

If the money you wish to rollover from RIC is invested with an inactive provider, be sure to ask if surrender charges will apply.

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Rollovers

If you are at least age 59 1/2 (while employed) or terminated from employment you have the option to roll over all or a portion of your 403b assets to another eligible plan. This is a non-taxable event.

If the money you wish to roll is with an active provider, contact them directly to request the required paperwork . If the money you wish to roll is with an inactive provider, call them and ask if there are restrictions or penalties.

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