W-2 Salary deferrals

[NSNM]

A new client brought a W-2 (2012) which shows among other information, the following:


(Box 1) .. 52009 Federal Wages

(Box 3&5).. 102482 Social security & Medicare wages

(Box 16).. 102482 State wages

(Box 12b).. 22500 Code E (elective deferrals under section 403(b) salary reduction agreement)

(Box 12c).. 22500 Code G (elective deferrals to a section 457(b) deferred compensation plan)

(Box 14).. 5473 414(h)


Taxpayer is over 50 and works for a county organization.

Question is could a W-2 employee allowed to defer wages to 3 separate retirement plans in
excess of $22500 (22500+22500+5473=50473) in a single year (2012) from a same employer.

Which IRS provision allows deferrals in excess of $22500 (for 2012) for a W-2 employee.

Is it possible that the organization obtained a private letter ruling from the IRS to this effect.

Taxpayer contributed to 3 plans in the past year also.

Appreciate and thank for any responses from the viewers.

[Gary2]

You might try to get in touch with the employer's retirement plan specialist, but I suspect they're all correct.

Pub. 571 goes into detail on 403(b) limits. There are limits on 403(b) plans that tie into other elective deferral plans, notably 401(k) plans, and sometimes SEP and SIMPLE plans, but I haven't seen anything that ties the limits to a 457 - other than the calculation of the total includible compensation for the purpose of determining the income limit. But these rules are complex and poorly explained.

The 414h plan is, I believe, mandatory government retirement, and thus it's easier to understand why it's unrelated to the elective retirement plans.

I'd be more worried about the overall $50,000 contribution limit, but even there, I think the limits may be separate for 403b and 457b plans.

[mactoolsix]

Maybe this link will help:

https://www.edwardjones.com/en_US/educators/choices/457b/index.html

Mike

[Traveling EA]

403 b & 457

I have several clients in the medical field. They work for different institutions and all have the max in 457 and max in either 401K or 403b plans. I am sure your scenerio is correct.

[NSNM]

Thanks for guiding

Gary - Pub 571 was helpful. Worksheet in Chapter 9 gives some understanding but I still find it not easy to decipher some of the line items.

Mike - Edward Jones' site you referred was very clear and easy to understand, and great help.

Travelling EA - Reading your response made me feel better.

Thank you all for guiding and appreciate your responses.