| All employees are eligible
to participate in Supplemental Retirement Annuities (SRA)
through payroll reduction. This program may be of special
interest to the employee not eligible to join the contributory
retirement plan or for the employee wishing to contribute
more than 5%. Under the guidelines established by IRS Code
Section 403(b) and 403(b)(7), the employee's annual salary
is reduced by the amount of his/her permitted contribution
for income tax purposes.
Employees may select from one of three vendors, including
insurance and mutual funds companies. Although St. Edward's
University does not restrict access to this money, IRS regulations
and contract provisions may restrict access, even after
termination of employment.
Hardship Withdrawal Policy In cases of extreme need,
employees may be permitted to access some or all of their
supplemental retirement accumulation before reaching ages
59½.
The employees' own elective deferrals, i.e., voluntary
contributions, and any earnings credited before 1989 may
be withdrawn for hardship. Only elective deferrals credited
on or after January 1, 1989 may be withdrawn for hardship
-- earnings cannot be withdrawn. Hardship withdrawals made
before the employee attains age 59½ will be subject
to ordinary income taxes and a 10 percent early-withdrawal
penalty.
A withdrawal qualifies as a hardship distribution under
the federal rules if it meets two conditions. First, the
participant must have an immediate and heavy financial need.
Second, the withdrawal must be necessary to satisfy the
need.
Once the financial need is deemed immediate and heavy,
the employee must still satisfy the second criteria by establishing
that the withdrawal is necessary to satisfy the need. A
hardship withdrawal distribution can not exceed the amount
of the need.
To request a hardship withdrawal from the supplemental
retirement plan, an employer should contact his/her retirement
vendor for the appropriate vendor forms and submit a completed
Hardship Withdrawal Request form (available in Human Resources
or on the web, http://www.stedwards.edu/humr/forms.htm)
to the Director of Human Resources.
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