Tax Sheltered Annuity Program - 403(b)

Tax Sheltered Annuity Program - 403(b)

All ACC employees may participate in the Tax Sheltered Annuity (TSA) program. A tax sheltered annuity is a tax-deferred arrangement expressly granted by Congress in Internal Revenue Code section 403(b).  Under this provision, the amount deposited into the TSA is not taxed as current income. Taxes are deferred until a later date, usually retirement. The College maintains a list of authorized vendors.

To start a tax sheltered annuity employees need to:

  • Select an ACC authorized TSA vendors

  • Set up an investment account with their chosen TSA vendor

  • Go to the ACC online enrollment system called Retirement Manager 

  • Enter how much they wish to contribute and which vendor they will use in Retirement Manager

  • Review your following paycheck to confirm that the payroll deduction has occurred and is correct. 

Contributions to a tax sheltered annuity can be stopped at any time by submitting your change online through ACC Retirement Manager. This will be effective based upon the current cut-off dates. There may be tax consequences and penalties for early withdrawals.  All elections and changes must be entered in Retirement Manager by the end of the month prior to when they are to be deducted from pay.

Contact the Office of Human Resources, Benefits Department for further information.

Seven Big Benefits

  1. All ACC employees may participate in the 403(b) plan.

  2. Your contributions and investment earnings aren't taxed until you withdraw the money. That means your money can grow much faster.

  3. Your contributions are painlessly deducted from your paycheck.

  4. Your contributions are tax-deferred, so you pay less in income taxes.

  5. You decide how your money is invested.

  6. In some cases, you can contribute more than the maximum allowed. That means your savings can grow further.

  7. If you change employers, you can take your 403(b) funds with you.

A 403(b) plan is probably a good choice for you if you:

  • are already investing some of your take home pay

  • are not struggling from paycheck to paycheck

  • pay income taxes

  • want to invest for retirement

  • have an emergency fund to cover three to six months' living expenses

Additional Information

DISCLAIMER: Austin Community College assumes no responsibility for the future performance of any offered investment program. It is the employee's responsibility to select and monitor the performance of the company in the future. The employee is responsible for all tax liabilities incurred as a result of the management or dissolution of the 403(b) Plan.