The Motley Fool Discussion Boards

Previous Page

Investing/Strategies / Retirement Investing


Subject:  Re: Military Service Credit Date:  8/24/1999  1:01 PM
Author:  zorloc Number:  13411 of 101548

I am not familiar with how the CalPERS system works, so I may not be able to provide a difinitive answer, but it sounds like you would be breaking the IRS rules.

The basic determination that needs to be made is if the CalPERS program is an employee or employer contribution plan. If to participate in the CalPERS program you have salary deferments or reductions which go to the plan then it is an employee funded program (it doesn't matter if there are matches from the employer). If they just set aside money for you, without your active participation, then it is an employer funded program.

Since you participate in a Deferred Comp program in 1998 your annual cap was (as you stated) $8,000. You cannot contribute more than this, combined, to ALL employee funded programs: SIMPLE (IRA, 401K), 401K, 403B, etc.

From your description of CalPERS, I am not sure though. With employee funded programs the funds contributed are from your salary, not savings. It may be something completely different. If you could provide some more info, I may be able to be more help. You can also contact someone at CalPERS to see if it counts against your $10,000 ($8,000 if in a deferred comp plan) individual contribution limit.


Copyright 1996-2021 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us