Table of Contents
Throughout this publication, the limit on the amount that can be contributed to your 403(b) account for any year is referred to as your maximum amount contributable (MAC). This chapter:
Introduces the components of your MAC,
Tells you how to figure your MAC, and
Tells you when to figure your MAC.
Generally, before you can determine your MAC, you must first figure the components of your MAC. The components of your MAC are:
Generally, contributions to your 403(b) account are limited to the lesser of:
The limit on annual additions, or
The limit on elective deferrals.
Depending upon the type of contributions made to your 403(b) account, only one of the limits may apply to you.
At the beginning of 2013, you should refigure your 2012 MAC based on your actual compensation for 2012. This will allow you to determine if the amount that has been contributed to your 403(b) account for 2012 has exceeded the allowable limits. In some cases, this will allow you to avoid penalties and additional taxes. See chapter 7.
Generally, you should figure your MAC for the current year at the beginning of each tax year using a conservative estimate of your compensation. If your compensation changes during the year, you should refigure your MAC based on a revised conservative estimate. By doing this, you will be able to determine if contributions to your 403(b) account can be increased or should be decreased for the year.
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