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Distribution options for the RCA Retirement Plan

The RCA Retirement Plan is a non-qualified deferred compensation plan and Fidelity is required to calculate and withhold federal and state taxes from all distributions from this plan. As a non-qualified deferred compensation plan, the tax reporting is done on a W-2. Declaration of housing allowance is done when a participant files their taxes. More information about claiming the housing allowance and the RCA Retirement Plan can be found here. If you wish to provide instructions regarding federal withholdings, they must be given to Fidelity through NetBenefits at https://www.netbenefits.com/

See how distribution options differ for the 403(b) program

Types of distributions that can be taken:

Upon attaining age 59 ½

Participants can take:

  • Annual lump sum distributions up to a maximum of 5% annually of the account balance as of December 31 of the prior year to be paid each year thereafter by March 1 (Section 7.1). This is optional and would be in addition to mandatory systematic withdrawals upon retirement. The election is irrevocable.
  • One time lump sum distribution up to 10% of the account balance with written evidence to purchase a home (Section 7.1).

Upon retirement*

Participants must:

  • Begin installment distributions within 60 days of retirement (Section 9.1), or
    • Mandatory: Systematic withdrawals (monthly, quarterly or annually), amount determined by you to commence immediately. (Systematic withdrawals cannot be changed or stopped.)
    • Optional: Up to 5% annual lump sum each year, upon reaching age 59.5.This election is in addition to systematic withdrawals, and is irrevocable and cannot be changed at any time.
    • One time only: Up to 10% lump sum, upon reaching age 59.5, one time for the purpose of purchasing housing.
  • Purchase an annuity in the participant’s name with the full balance (Section 9.1). A full payout is not available in this scenario.

Upon documented disability

With loss of compensation and before installment distributions have begun (Section 9.2).

Participant’s may:

  • Begin installment distributions within 60 days of the documented disability (Section 9.1), or
  • Purchase an annuity in the participant’s name with the full balance (Section 9.1). A full payout is not available in this scenario.

Upon hardship or unforeseeable emergency

  • Supporting documents are required for this type of distribution (Section 7.2).

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

Housing allowance

  • The RCA Retirement Plan is a non-qualified deferred compensation plan and Fidelity is required to calculate and withhold federal and state taxes from all distributions. Tax reporting is done on a W-2. The federal taxes withholding can be adjusted in your online account (www.netbenefits.com). Because of this, ministers may not request that their distributions be tax-free, and the declaration of housing allowance is done at the time a minister files his/her taxes.

Types of distributions that can be taken:

Upon attaining age 59 ½

  • Lay employees can take annual lump sum distributions up to a maximum of 5% annually of the account balance as of December 31 of the prior year to. This is optional, and would be in addition to mandatory systematic withdrawals upon retirement. This election is irrevocable and will be paid each year thereafter by March 1 (Section 7.1). 

Upon termination or retirement before age 60*

  • Begin installment distributions within 60 days of the termination or retirement date (Section 9.1).
    • Mandatory: Systematic withdrawals (monthly, quarterly or annually), amount determined by you to commence immediately. (Systematic withdrawals cannot be changed or stopped.)
    • Optional: Up to 5% annual lump sum each year, upon reaching age 59.5.This election is in addition to systematic withdrawals, and is irrevocable and cannot be changed at any time.
    • One time only: Up to 10% lump sum, upon reaching age 59.5, one time for the purpose of purchasing housing.
  • Purchase an annuity in the participant’s name with the full balance (Section 9.1).
  • Request a full payout

Upon retirement or termination at age 60 or later*

Participants must:

  • Begin installment distributions within 60 days of termination or retirement (Section 9.1).
  • Purchase an annuity in the participant’s name with the full balance (Section 9.1). A full payout is not available in this scenario.

Upon documented disability

With loss of compensation and before installment distributions have have begun (Section 9.2).

Participants may:

  • Begin installment distributions within 60 days of documented disability (Section 9.1), or
  • Purchase an annuity in the participant’s name with the full balance (Section 9.1)

Upon hardship or unforeseeable emergency

  • Supporting documents are required for this type of distribution (Section 7.2)

Types of distributions that can be taken:

If a married participant dies before taking distributions

The beneficiary must:

  • Begin installment distributions within 60 days (Section 10.2), or 
  • Request a full payout (Section 10.2).

If a married participant was in pay status prior to their death

The spousal beneficiary must:

  • Continue the same payment plan that the participant was receiving (Section 10.3), or,
  • Request a full payout (Section 10.3).

Upon the death of the spousal or non-spousal beneficiary, the entire balance will be paid in a lump sum to their beneficiary(ies) (Section 10.4).

Types of distributions that can be taken:

Alternate payees are defined 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 must take a full payout distribution as documented in the domestic relations order from the court (Section 13.1)

* Retirement is the relinquishment of employment on or after the participant attains 60 years of age, and in the case of RCA Ordained Ministers, a written declaration of retirement by their classis (Section 2.23).

Additional information:

  • The option to purchase an annuity in the name of the Board of Benefits Services has been suspended through 2025.