State of Washington Deferred Compensation Program (DCP)
This is an optional investment program for employees who would like to save money on current year's taxes and save for retirement at the same time. This program provides employees control and flexibility over their individual investments while giving them a way to reduce their current year's taxable income. Employees can invest in the DCP in addition to investing in the 403b Plan (TSA). The DCP provides an option to the employee to invest income on a pre-tax basis up to the IRS maximum each calendar year.
The Department of Retirement Systems administers the plan. For more information on the DCP plan, visit their website at http://www.drs.wa.gov/dcp . Enrollment is done directly through DCP, they will notify Northshore of your election decision.
Annual Max. Increased For The Deferred Compensation Plan (DCP) For The 2013 Tax Year
Annual deferral limits have been increased by $500 for the 2013 tax year for the DCP Plan. You will now be able to defer up to $17,500/year (up to $23,000 for those over the age of 50).
You Can Make Changes To Your DCP Deferral Amount By Choosing One Of The Following Options:
Why Participate in DCP?
Costs are Low. DCP offers you investment options with lower fees than most other investment and annuity products. Low investment fees allow you to keep more of your money. A 1% increase in a fund's expenses can significantly reduce your account value over the long term.
Assets are NOT subject to the 10% early withdrawal tax penalty. Withdrawal is available without penalty at any age you separate from service, or you may let funds continue to grow tax-deferred.
Eligible distribution flexibility.You can change your distribution arrangements as many times as you want to meet your retirement needs as long as you begin receiving payments during the year after you reach age 70 ½. ANY AMOUNT, ANY TIME.
Flexible, easy account management. DCP offers you the flexibility to enroll, increase, decrease, change investment options or suspend your deferrals at any time, with no extra fees. The DCP Web site allows you to manage your retirement savings or you may access our Voice Response Unit (VRU) with access to customer service representatives who can answer your plan-specific questions.
Rollovers. Once enrolled in DCP you may roll over certain distributions from a prior employer-sponsored plan such as a 401k, 403b (tax sheltered annuity), another 457 (DCP) or traditional IRA into your DCP account.
Washington State Investment Board works for you. All DCP funds are selected by the Washington State Investment Board (WSIB) after a rigorous examination emphasizing value, security and diversification. Trustees of the WSIB have fiduciary responsibility to act only for the benefit of the participants.