| Features |
Governmental 457(b) Plan |
403(b) Plan |
| Contribution Limits – Year 2026 |
- $24,500 basic maximum contribution limit
- 457(b) limits not coordinated with 403(b) plan
|
- $24,500 basic maximum contribution limit
- 403(b) limits not coordinated with 457(b) plan
|
| Early Withdrawal IRS Penalty Tax |
None – (normal income tax only) |
10% early withdrawal penalty tax may apply under age 59 ½ plus normal income tax |
| Eligibility Rules |
Non-discrimination rules do not apply |
Universal Availability Rule non-discrimination applies |
| Small Balance Distribution |
- Account balance $5,000 or less
- No contributions in the past 24 months
|
Not applicable |
| Age 50 Catch-Up Option |
Total of $8,000 annual limit – not permitted if special catch-up option used |
Total of $8,000 annual limit |
| Special Catch-Up Option |
As permitted in the plan document. |
As permitted in the plan document. |
| Purchase Service Credit State Retirement System |
Permitted |
Permitted |
| Distribution Restrictions |
- Severance from employment
- Age 70 ½ while employed
- Disability or death
- Small account balance
- Unforeseeable emergency
|
- Severance from employment
- Age 59 ½ while employed
- Disability or death
- Financial hardship (If permitted in the plan document)
|
| Portability of Plan Funds after Qualifying Event |
Funds can be rolled over to:
- Governmental 457(b) plan of another employer
- Another 457(b) provider approved in the plan
- Another 403(b) plan
- IRA (Traditional, SEP, SAR – SEP, Roth)
- Pension, profit sharing, 401(k)
- If permitted by both plans
|
Funds can be rolled over to:
- Another 403(b) provider in the plan
- Another 403(b) plan
- Governmental 457(b) plan of another employer
- IRA (Traditional, SEP, SAR-SEP, Roth)
- Pension, profit sharing, 401(k)
- If permitted by both plans
|
| Hardship / Unforeseeable Emergency Distributions |
Contributions may be distributed to the extent required for an unforeseeable emergency defined by the IRS as a severe financial hardship to you resulting from events such as a sudden and unexpected illness; an accident you or a dependent experience; loss of your property because of casualty; or other similar extraordinary and unforeseen circumstances arising as a result of events beyond your control. Withdrawals are only permitted for limited financial circumstances that must be substantiated. |
Contributions may be distributed to the extent required for a financial hardship defined by the IRS as expenses deemed to be immediate and heavy, including: (1) certain medical expenses; (2) purchase of a principal residence; (3) tuition and related educational fees and expenses; (4) prevent eviction from, or foreclosure on, a principal residence; (5) burial or funeral expenses; and (6) certain expenses for the repair of damage to the employee’s principal residence. Withdrawals are only permitted for limited financial circumstances that must be substantiated. |
| Loans |
Applies to all accounts and all plans (403(b) & 457(b)) of the employer; limited to the lesser of:
- $50,000 or
- One half of the vested account balance
- (If permitted in the plan document)
|
Applies to all accounts and all plans (403(b) & 457(b)) of the employer; limited to the lesser of:
- $50,000 or
- One half of the vested account balance
- (If permitted in the plan document)
|
| Required Minimum Distribution |
RMD rules apply as follows:
- If you were born between 1951 and 1959, the beginning age for RMDs is 73. You must take the RMD by April 1 following the calendar year in which you reach the beginning age.
- If you were born in 1960 or later, the beginning age for RMDs is 75. You must take the RMD by April 1 following the calendar year in which you reach the beginning age.
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RMD rules apply as follows:
- If you were born between 1951 and 1959, the beginning age for RMDs is 73. You must take the RMD by April 1 following the calendar year in which you reach the beginning age.
- If you were born in 1960 or later, the beginning age for RMDs is 75. You must take the RMD by April 1 following the calendar year in which you reach the beginning age.
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