Contribution & Future Allocations

  • What are the contribution limits for 2017?
  • 2017 Annual Maximum Contribution Limits

    Participant Age

    Maximum Limit

    Under Age 50

    $18,000

    Age 50 & Over

    $24,000

    Catch-Up Provision*

    $36,000


    Each calendar year, the IRS modifies the annual contribution limits based on cost-of-living adjustments. The IRS announces annual increases toward the end of each calendar year as specific cost-of-living benchmarks are known.

    * See next question for more information about the Catch-Up Provision.
     

  • Can I contribute more if I am nearing retirement?
  • If you are age 50 or older, you may contribute an additional $6,000, for a total of $24,000 in 2017.

    In addition, a Catch-Up provision allows you to make up for under-used deferrals by allowing twice the normal limit for the three consecutive calendar years prior to your normal retirement age. Normal retirement age is generally the age at which you are eligible to collect a full pension benefit. You cannot combine the Catch-Up provision with the age 50 and over contribution limit. For more information, or to request the Catch-Up Rules and Election brochure, call a MSRS Representative at 1-800-657-5757, option 3.
     

  • How do I change my contribution amount?
  • Changing the amount you contribute to your MNDCP account per pay period just got easier. Instead of completing a form, you have the following options to change your contribution amount.
     
    State of Minnesota employees:
    1. Select Other Payroll
    2. Select Input Deferred Cmp/TSA Deductn under the Savings Plans tab
    3. Click Add Savings Plan
    4. Make change and click Save
    • Contact an MSRS Representative2 at 1-800-657-5757, option 3

     

    Other Minnesota Public Employees:
    1.   Select the Transactions tile
    2.   Select Change Paycheck Contribution
    • Contact an MSRS Representative2 at 1-800-657-5757, option 3

     

    Note regarding lump-sum deferrals:
    If you are a non-state employee and wish to contribute a lump sum amount of the following examples of pay, please contact your Human Resources/Payroll Representative. The normal contribution amount MNDCP keeps on file is intended for the ongoing amount per pay period that is being deducted from your paycheck. It is not intended for one-time contributions.

    • Severance (sick or vacation)
    • Overtime payments
    • Retro pay
    • Achievement awards
    • PTO (paid time off) pay
    • Any one-time change in your deferral amount

     

    1 Access to the voice response system and/or any website may be limited or unavailable during periods of peak demand, market volatility, systems upgrades/maintenance or other reasons.
    2 Representatives of GWFS Equities, Inc. are not registered investment advisors and cannot offer financial, legal or tax advice. Please consult with your financial planner, attorney and/or tax advisor as needed.

     

  • Does my employer or union contribute matching dollars?
  • Your employer or bargaining unit may match a portion of the dollars you contribute to your account. Matching dollars are applied to your account dollar-for-dollar, per fiscal year. Once you reach the matching limit, your employer will no longer contribute matching dollars until the next fiscal year. The annual contribution limits take into account employer matching contributions. Contact your employer or bargaining unit to determine if they offer any matching dollars to your MNDCP account.
     

  • Are there any tax incentives for low income savers?
  • Yes. You may be eligible for an income tax credit of up to $1,000 just by contributing to your MNDCP account. It's called the Saver's Tax Credit.

    The amount of the credit is determined by your filing status, your adjusted gross income (AGI), and contributions to a qualifying retirement plan, like your MNDCP account. You may not take the credit if, during 2016, you were under age 18, or were a full-time student, or claimed as a dependent on someone else's 2016 tax return.

    Use the chart below to determine the percentage of the allowable credit for 2016.

    AGI
    Married Filing Jointly

    AGI
    Head-of-Household

    AGI
    Single

    Percent Credit

    $0 - $37,000

    $0 - $27,750

    $0 - $18,500

    50% on first $2,000

    $37,001 - $40,000

    $27,751 - $30,000

    $18,501 - $20,000

    20% on first $2,000

    $40,001 - $61,500

    $30,001 - $46,125

    $20,001 - $30,750

    10% on first $2,000

    $61,501 & over

    $46,126 & over

    $30,751 & over

    0%


    If you qualify, complete IRS Form 8880 and attach it to your federal tax return. Form 8880 includes instructions to calculate the credit correctly. IRS publications and tax forms can be downloaded at http://www.irs.gov.

  • How do I change the fund(s) to which my contributions are allocated?
  • There are three ways to change your future fund allocations:
    1. Log into your account.1 From the Transactions tile, select Change Future Investments; or
    2. Call the Automated Voice Response System1 at 1-800-657-5757, option 2: or
    3. Contact an MSRS Representative2 at 1-800-657-5757, option 3.

     

    1Access to the voice response system and/or any website may be limited or unavailable during periods of peak demand, market volatility, systems upgrades/maintenance or other reasons.
    2Representatives of GWFS Equities, Inc. are not registered investment advisors and cannot offer financial, legal or tax advice. Please consult with your financial planner, attorney and/or tax advisor as needed.

Transfer Procedures, Trading Restrictions, & Plan Fees

  • What fees will I pay to participate in the MNDCP?
  • There are two types of fees:

    Administrative fee - This annual fee, which is used to pay for recordkeeping, communication, customer service and other services provided, is 0.10% (or one-tenth of 1%) capped on the first $125,000 account balance. The maximum annual fee a participant will pay is $125. The administrative fee is deducted from the account each month and is reflected on your quarterly statement.

    Example: If you had a balance of $25,000 at the end of the month, your Administrative fee for that month would be $2.08 ($25,000 x .00010 รท 12 months)

    Operating expenses - Each investment option has an investment management fee (known as an expense ratio) that varies by investment option. These fees pay for trading and management expenses of the investment provider. The fee is deducted from each investment option's management company (not MNDCP) before the daily price per share or calculation of the fund's performance return.


    All fees are disclosed on the Performance Report Sheet that is included in your quarterly statement and updated monthly under the Investments tab on this website.
     

  • Are there restrictions or fees when I trade between my investment options?
  • The following investment options have restrictions and/or fees:

     

    • T. Rowe Price Small Cap Stock Fund - The fund restricts purchases (or transfers) into the fund for a period of 30 calendar days after a withdrawal (or transfer) out of the same fund (the "30-Day Purchase Block").
       
    • All Vanguard Funds - Participants who transfer money out of these funds are not permitted to transfer money back into the same Vanguard fund for 60 calendar days.
       
    • Dodge & Cox Income Fund - This fund has a restriction designed to address excessive trading and market timing practices. For more details, contact an MSRS Representative at 1-800-657-5757, option3.
       
    • SIF Stable Value Fund  - You may not transfer balances directly to the SIF Money Market Fund. Balances must be transferred to another investment option and then after 90 days may be transferred to the SIF Money Market Fund.
     
    Please consider the investment objectives, risks, fees and expenses carefully before investing. For this and other important information
    you may obtain mutual fund prospectuses and disclosure documentsfrom your registered representative. For prospectuses related to investments
    in your Self-Directed Brokerage (SDB) account, contactTD Ameritrade at 1-866-766-4015. Read them carefully before investing.

  • If I initiate a transfer, when will my request be processed?
  • Transfer requests initiated prior to 3:00 PM Central Time will be processed at the close of the financial markets on that business day. Transfer requests initiated after 3:00 PM Central Time or on non-business days will be processed at the close of the financial markets on the next business day.
     

  • How do I transfer money between different investment options in my account?
  • You can adjust the mix of investments in your MNDCP account at any time. Regularly reviewing your asset allocation strategy and investment options is a good idea. The MNDCP does not charge any account maintenance or trading fees; however, funds may impose their own redemption fees on certain transfers or withdrawals held for less than the required period.

    To initiate a transfer, call an MSRS Representative1 at 1-800-657-5757, option 3 or log into your account 2 from this website and select Transfer My Investments under the Transactions tile.
     

    1Representatives of GWFS Equities, Inc. are not registered investment advisors and cannot offer financial, legal or tax advice. Please consult with your financial planner, attorney and/or tax advisor as needed.

    2Access to the voice response system and/or any website may be limited or unavailable during periods of peak demand, market volatility, systems upgrades/maintenance or other reasons.
     

  • The MNDCP investment options are limited. Is there any way to invest in other options?
  • A Self-Directed Brokerage Account, offered through TD Ameritrade, allows you the opportunity to select from numerous mutual fund options. MNDCP will assess an additional annual administrative fee of $30 for the use of this service.

    The minimum transfer amount from an MNDCP account to TD Ameritrade is $500. You must also maintain a minimum balance of $500 in your MNDCP core funds. Payroll deductions may not be invested directly to the Self-Directed Brokerage Account nor can distributions be taken directly from the Self-Directed Brokerage Account. For more information on the mutual fund options available through TD Ameritrade, please call TD Ameritrade directly at 1-866-766-4015.
     

    Brokerage services provided by TD Ameritrade, Inc., member FINRA/SIPC/NFA.
    TD Ameritrade is a trademark jointly owned by TD Ameritrade IP Company, Inc. and the Toronto-Dominion Bank. Used with permission.
    Additional information can be obtained by calling TD Ameritrade at 1-866-766-4015. TD Ameritrade and GWFS Equities, Inc. are separate and unaffiliated.

Withdrawals

  • When can I withdraw money from my MNDCP account?
  • You are eligible to withdraw money from your account 30 days after you retire or terminate from employment or upon the death of the participant (distribution will be initiated by the designated beneficiary).

  • How do I withdraw money from my MNDCP account?
  • You will need to complete a Distribution Request form. Please contact MSRS at 1-800-657-5757, option 3 to obtain this form (the form is not available on this website). You may also request a withdrawal online at any time once you log into your account.1 Select Withdrawal Request from the Withdrawals tile.

    Please note: Only the participant may request the form. We cannot accept a request from any other party including a spouse, family member, or personal financial representative.
     

    1Access to the voice response system and/or any website may be limited or unavailable during periods of peak demand, market volatility, systems upgrades/maintenance or other reasons.

  • Can I withdraw money from my MNDCP account while employed?
  • Generally, you can only access your account assets when you terminate employment with the employer sponsoring the MNDCP, however, there are four types of withdrawals you may request while still employed:

    1. Unforeseeable Emergency - If you suffer an unforeseen emergency resulting in severe financial hardship that cannot be satisfied by any other source, you may apply for a withdrawal. Contact MSRS at 1-800-657-5757, option 3 to obtain the necessary application.
       
    2. Purchase of your public employment service credit - You may be eligible to transfer assets from your MNDCP account to your governmental defined benefit pension plan to purchase permissible service credits. For additional information, contact MSRS at 1-800-657-5757, option 3.
       
    3. De Minimis Distribution - You may be eligible to withdraw your entire account balance while still employed if all of the following criteria are met:
      1. Your MNDCP account balance is $5,000 or less, and
      2. You have not contributed to your MNDCP account for the past two years, and
      3. You have not previously taken a De Minimis distribution.
         
    4. Qualified Rollover - You are eligible to withdraw any portion of your account balance that represents assets that were rolled into your MNDCP account from another qualified retirement plan or IRA.

  • What are the taxes and penalties for withdrawing money?
  • If you made pre-tax contributions to your MNDCP account, you "defer" taxes until such time when you withdraw your balance. Therefore, any withdrawals are includible in gross income for both federal and state income tax purposes and are taxed as ordinary income in the year the withdrawal is made. MNDCP is required by law to withhold 20% federal income tax. State income tax is only withheld if your resident state mandates income tax withholding (Minnesota does not) or if you indicate your preferred withholding on the distribution form.

    If you made Roth after-tax contributions to your MNDCP account, you paid income tax at the time they were contributed; therefore, withdrawals from your MNDCP Roth account are completely tax-free as long as you meet the following conditions.
     
    • Your MNDCP Roth account (which includes Roth amounts rolled over) must have remained invested for at least a 5-taxable-year period. The 5-taxable-year period of participation begins on the first day of the taxable year in which an initial Roth contribution was made to your Roth MNDCP account. It ends when five consecutive taxable years have passed.

      AND the withdrawal is either made:
     
    • after attainment of age 59 1/2, or
    • to a designated beneficiary after your death, or
    • in the event of disability.
       

    Any withdrawal taken from your MNDCP Roth balance before the end of the 5-taxable-year period or prior to age 59 1/2 is considered a nonqualified Roth withdrawal, negating the tax-free benefit of the associated earnings. The earnings only portion of the nonqualified Roth withdrawal will be reported as taxable and subject to 20% mandatory federal income tax withholding. However, the contribution portion of the nonqualified Roth withdrawal is not taxable.

    Neither MSRS nor any of its representatives are able to provide legal or tax advice.
     

  • What is a Required Minimum Distribution (RMD)? When do I need to start the RMD?
  • If you have retired or separated from service with a participating employer, you must begin receiving payments no later than April 1 following the calendar year in which you turn age 70 1/2 and then by the end of every calendar year thereafter. This is called your Required Minimum Distribution (RMD). Each fall, we will mail you a reminder notice regarding your RMD payment.

    To start your RMD, contact MSRS at 1-800-657-5757, option 3 to obtain the Required Minimum Distribution Request form.

    The RMD brochure explains how your RMD amount is calculated each year.
     

Rollovers

  • Can I roll my previous employer's retirement account balance into MNDCP?
  • MNDCP accepts assets from other retirement plan accounts. You may roll money from the following types of plans into your MNDCP:
     
    • Traditional IRA
    • 401(k)
    • 403(b)
    • 401(a)
    • 457(b)
       

    You may not roll after-tax assets from a Roth IRA into your MNDCP account.

    To initiate an incoming rollover, complete and return the Incoming Direct Rollover form or call MSRS at 1-800-657-5757, option 3 to request the form. You'll also want to contact your previous plan provider to confirm that those assets are eligible for rollover and ask about their paperwork requirements.

    Carefully compare your options for differences in cost, benefits, charges and any other important features before you rollover assets. You may want to consult your legal or tax advisor.
     

  • How do I roll money out of my MNDCP account?
  • You are eligible to rollover your MNDCP account balance to another qualified retirement plan 30 days after you retire or terminate from employment. Qualified retirement plans include:
     
    • Traditional or Roth IRA's
    • 401(k)
    • 403(b)
    • 401(a)
    • 457(b)
       

    To initiate a rollover you must complete a Distribution/Direct Rollover Request form, which can be obtained by calling MSRS at 1-800-657-5757, option 3 (the form is not available on this website).

    Please note: Only the participant may request the form. We cannot accept a request from any other party including a spouse, family member, or personal financial representative.

    Carefully compare your options for differences in cost, benefits, charges and any other important features before you rollover assets. You may want to consult your legal or tax advisor.
     

  • Are there any penalties for rolling my money?
  • No. You will not be taxed or penalized for rolling assets between qualified retirement plan accounts. You only pay taxes when you take a distribution from the account.

    Exception: Since Roth IRA accounts are funded with after-tax dollars, you will be required to pay taxes on the pre-tax portion of your MNDCP account that you rollover to a Roth IRA.
     

Miscellaneous Account Changes

  • How do I change my beneficiaries?
  • There are two ways to change a beneficiary designation:
    1. Log into your account 1 and select Beneficiary from the My Profile tile.
    2. Complete and return the Beneficiary form or call MSRS at 1-800-657-5757, option 3 to request the form.

     

    1Access to the voice response system and/or any website may be limited or unavailable during periods of peak demand, market volatility, systems upgrades/maintenance or other reasons.

  • I have moved. How do I change my address?
  • Address changes may be requested:
    1. Contact MSRS at 1-800-657-5757, option 3
    2. Complete and return the Personal Information Change Request form or call MSRS to request the form.
    3. Log into your account1 and select the My Profile tile. You may only change your address online if you have separated from service.
       

    Please note: An address change may only be requested by the participant or someone who has Power of Attorney (as long as we have appropriate documentation on file). Only the participant may change their address. We cannot accept a change from any other party including a spouse, family member, or personal financial representative.
     

    1Access to the voice response system and/or any website may be limited or unavailable during periods of peak demand, market volatility, systems upgrades/maintenance or other reasons.
     

  • I got married / divorced. How do I change my last name?
  • Complete and return the Personal Information Change Request form or call MSRS at 1-800-657-5757, option 3 to request the form.

    A photocopy of the marriage certificate or entire divorce decree must be provided with the form.
     

  • I have a periodic payment set-up. How do I make changes to my periodic payment?
  • Contact MSRS at 1-800-657-5757, option 3 to request changes to your periodic payment including the payment amount, the payout date, the tax withholding amount, or to stop a periodic payment.

    If your periodic payments are automatically deposited into your bank account and you've changed banks or banking information, complete and return the Direct Deposit form with your updated banking information.