Advanced Underwriting Consultants

Question of the Day – October 15

Ask the Experts!

Here’s the question of the day.

Question:  What’s the deadline to make a contribution of unpaid sick pay into a 403 b plan after retirement?

Answer:  Two and one half months after severance OR the end of the tax year, whichever is longer.

Here’s an excerpt from the IRS website:

Post-Severance Contributions: Plans may permit ….contributions to be made to 403(b) plans after an employee separates from service.

Elective deferrals: Employees may defer some (up to their annual deferral limits) of their regular, accrued vacation and sick pay into their 403(b) accounts if received by the later of 2 ½ months from the date of severance or the end of the limitation year (in most cases, calendar year) in which the severance occurred.

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