403(b) Contributions

One of the easiest ways to reduce income taxes is to maximize contributions to your 403(b) account. Deductions made from your paycheck will lower your taxable earnings reported on your annual W-2 form. Since the end of the year is fast approaching, this is a reminder that you only have a few paychecks remaining to contribute to the 403(b) plan; the final paycheck in 2005 is December 1st for monthly paid employees and December 23rd for biweekly paid employees.

The Internal Revenue Code limits the amount you can contribute annually to the 403(b) plan. This year's limit for employees under 50 years old is $14,000 and $18,000 for those age 50 years and over*.

If you have 15 or more years of UC employment and meet additional eligibility criteria, you may also have the opportunity to increase your annual contribution limit up to an additional $3,000 by utilizing the Catch Up Provision; please see the Fidelity website or contact Fidelity's customer service for information and assistance. Note: if you have utilized that Catch Up Provision in 2004 and you have not already re-elected to use the provision in 2005 you must contact Fidelity to do so. The Catch Up Provision is not automatically carried over into the following tax year.