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Distribution options for the 403(b) Program

The RCA 403(b) Retirement Program is a qualified plan and Fidelity withholds a mandatory 20% for Federal Taxes. Tax reporting is done on a 1099-R. However, as an RCA minister, participants may request  that their distributions be “housing distributions” in which case Fidelity will not withhold any taxes and the distributions will be coded as 7 – regular distribution and Box 2b will indicate that “Taxable amount not determined”. Participants can request the “housing distributions” option when calling Fidelity at: (800) 343-0860 or access the account online at: www.netbenefits.com

See how distribution options differ for the RCA Retirement Plan

Types of distributions that can be taken:

In-Service Withdrawal

  • Upon reaching age 59.5, participants can withdraw or rollover up to 100% of their employee contributions (Section 7.6).
  • A participant may, at any time and regardless of such participant’s age, request a withdrawal of all or a portion of his or her Rollover Contributions and Roth Rollover Contributions and any earnings thereon (Section 7.6).

Hardship

  • A participant who has not begun to receive retirement benefits or pre-retirement termination benefits may take a hardship withdrawal of all or a portion of his or her employer contributions and employee contributions (excluding any interest credits or earnings attributable to any elective deferrals). A hardship distribution must be made on account of an immediate and heavy financial need and must be necessary to satisfy the financial need  (Section 7.10).

For an overview of what might qualify as a hardship distribution, view this resource

Loan

  • General loans and home loans are available for active and terminated participants before age 59.5 (Section 7.13).

In-plan Roth Rollover

A participant may elect to transfer amounts to an In-Plan Roth Rollover Account or In-Plan Roth Transfer Account (Section 7.12).

Retirement or Termination benefits

  • Upon retirement* participants can withdraw (partial lump sum, full payout, installments) or rollover up to 100% of the account balance (Section 7.1).
  • Participants are required to begin taking required minimum distributions at age 72 (73 if you reach age 72 after Dec. 31, 2022) unless actively working. To calculate your RMDs, use this calculator.

Housing allowance distribution

  • The RCA 403(b) Retirement Program is a qualified plan and Fidelity withholds a mandatory 20% for federal income taxes. Tax reporting is done on a 1099-R. Retired ministers can request that their distributions be “housing distributions” in which case Fidelity will not withhold any taxes and the distributions will be coded as 7 – Regular distribution. In box 2b it will say “taxable amount total not determined”.

Types of distributions that can be taken:

In-Service Withdrawal

  • Upon reaching age 59.5, participants can withdraw or rollover up to 100% of their employee contributions (Section 7.6).
  • A participant may, at any time and regardless of such participant’s age, request a withdrawal of all or a portion of his or her Rollover Contributions and Roth Rollover Contributions and any earnings thereon (Section 7.6).

Hardship

  • A participant who has not begun to receive retirement benefits or pre-retirement termination benefits may take a hardship withdrawal of all or a portion of his or her employer contributions and employee contributions (excluding any interest credits or earnings attributable to any elective deferrals). A hardship distribution must be made on account of an immediate and heavy financial need and must be necessary to satisfy the financial need  (Section 7.10).

Loan

  • General loans and home loans are available for active and terminated participants before age 59.5 (Section 7.13).

In-plan Roth Rollover

  • A participant may elect to transfer amounts to an In-Plan Roth Rollover Account or In-Plan Roth Transfer Account (Section 7.12).

Retirement or Termination benefits

  • Upon retirement or termination of employment, participants can withdraw (partial lump sum, full payout, installments) or rollover up to 100% of the account balance (Sections 7.2 and 7.3).
  • Participants are required to begin taking required minimum distributions at age 72 (73 if you reach age 72 after Dec. 31, 2022) unless actively working. To calculate your RMDs, use this calculator.

Types of distributions that can be taken:

  • Foreign Missionaries should refer to the RCA Ordained Ministers section if the foreign missionaries are RCA Ordained Ministers or to the Lay Employees section if the foreign missionaries are not RCA Ordained Ministers (Sections 7.1 and 7.2).

Types of distributions that can be taken:

  • Beneficiaries can request withdrawals (partial lump sum, full payout, installments) or rollover up to 100% of their account balance at any time. 
  • If the participant was taking Required Minimum Distributions (RMD), beneficiaries may be required to take the RMD based on the participant’s age, not the beneficiary’s age (Section 8.3).

Types of distributions that can be taken:

Alternate payees is described as any spouse, former spouse, child, or other dependent of a participant who is recognized by a domestic relations order as having a right to receive all, or a portion of, the benefits payable under a plan with respect to such participant.

  • Alternate payees can choose a full payout or full rollover once the funds granted are assigned to their Qualified Domestic Relations Order (QDRO) account.

* Retirement is the relinquishment of employment together with documentation from the employer for lay employees or lay foreign missionaries and in the case of RCA Ordained Ministers, a written declaration of retirement by their classis (Section 2.35).

Additional information:

  • Required minimum distributions (RMD): 
    • For participants who attained age 70.5 on or after January 1, 2020, the RMD will be distributed no later than April 1 following the calendar year in which the participant attains age 72 (73 if you reach age 72 after Dec. 31, 2022) or the calendar year in which the participant retires (Section 8.3).
    • To calculate your RMDs, use this calculator or contact Fidelity at 800-343-0860. 
  • The RCA 403(b) Retirement Program is a qualified plan and Fidelity withholds a mandatory 20% for federal income taxes. Tax reporting is done on a 1099-R. The federal taxes withholding can be adjusted in your online account (www.netbenefits.com) when you are requesting the distributions. If eligible, ministers can request that their distributions be designated as “housing distributions” in which case, Fidelity will not withhold any taxes and the distributions will be coded as 7 – Regular distribution and Box 2b of the 1099-R  will note “taxable amount total not determined”.