Retirement Specialist With Over 40 Years Of Retirement Planning Experience
The employees of public school systems and 501(c)(3) non-profit organizations can participate in tax-deferred annuity (TDA) plans established by their employers.
A TDA has tax-favored status:
The amount contributed to a TDA is not reported as income1, which means that your taxable income is reduced by the amount of your TDA contributions.
The increases on your TDA contributions compound tax-deferred until withdrawn1, providing you with a double tax benefit.
(1) Ordinary income taxes are due upon withdrawal. Withdrawals may also be subject to a 10% penalty tax if taken before age 59-1/2. While many plans can help you save for a financially-secure retirement, the tax advantages of a TDA may enable you to increase your nest egg dollars at a faster rate than would otherwise be possible!