Human Resources

Staff Handbook

Tax-Deferred Plans

Tax Deferred Account (TDA) and Deferred Compensation Plan (DCP) are tax deferred retirement saving plans that eligible employees may join at any time during their employment with Texas A&M University-Kingsville. Participation is in addition to TRS or ORP; forms are available in the Human Resource Office.

Tax Saver Spending Accounts can be an excellent way to save tax dollars. Employees must look at their own situation to decide whether spending accounts offer them an advantage. In general, if they spend more than $240 a year for health care or more than $480 a year on dependent care they can save money by using one of these accounts. They avoid payment of federal income tax or Social Security tax on money going into the accounts.

After enrolling, their elections remain in effect until the end of that fiscal year. Employees may change your election only at the beginning of each plan year, unless they experience a qualified family status change. If this happens, they may change their elections within 31 days of the change. They can be reimbursed only for eligible claims incurred after enrolling. If not used in the fiscal year, they lose their remaining contributions.

A Supplemental Tax Sheltered Annuity Program, (TSA) voluntary 403(b) plan is also offered by Texas higher education institutions. It is available to both TRS and ORP participants, providing valuable flexibility and additional tax deferred funds for employees' personal retirement plan. The TSA receives no employer contribution and is subject to a federally established maximum amount that may be tax deferred. The amount that can be deferred uses a maximum exclusion allowance formula that takes into accounts other tax-deferred contributions.

Please contact your human resource office for more details on one of these accounts.

This page last updated 21 December, 2004