457(b) Deferred Compensation Plan
To help with your retirement savings, Georgetown University offers a 457(b) Deferred Compensation Plan (457(b) Plan).
The 457(b) Plan offers an exclusive opportunity to a select group of management and highly compensated employees to double the tax-deferred contributions that can be set aside annually for retirement.
Who is Eligible?
In order to be eligible you must meet the following criteria:
- You must be a highly compensated employee whose base salary is equal to or exceeds $200,000; and
- you must be making the maximum deferrals allowed by the IRS ($22,500 or, if age 50 or older, $30,000 in 2023) to the Defined Contribution Retirement Plan (DCRP) and the Voluntary Contribution Retirement Plan (VCRP).
How does the 457(b) Plan work?
Your 457(b) Plan contributions are automatically deducted pre-tax through payroll contributions, reducing your current taxable income and taxes owed for the year. Federal income taxes (and in most cases, state and local income taxes) on contributions and earnings are typically deferred in a 457(b) plan until withdrawn. Your 457(b) Plan contributions, however, remain subject to FICA taxes.
Unlike the DCRP and VCRP, IRS regulations that govern 457(b) plans require that your 457(b) contributions (including any earnings resulting from your deferrals to the 457(b) Plan), be part of the University’s general assets. However, upon separation from employment, you are automatically entitled to your 457(b) contributions and any earnings that may result.
Enrolling in the 457(b) Plan
You can check your eligibility and elect to participate in the 457(b) Plan in GMS at any time. You may follow the step by step instructions here.
When enrolling in this plan, you will be prompted to select either Fidelity, TIAA or Vanguard.