0821 Publ 4483 (PDF) — verbatim text

Official source: IRS Forms, Instructions & Publications (https://www.irs.gov/pub/irs-pdf/p4483.pdf), retrieved 2026-10-03. U.S. Government work (17 U.S.C. § 105).

contributions or a combination of both.

Read on to learn about:

Common 403(b) plan mistakes, and
IRS products (including the 403(b) Fix-It Guide), services and assistance to help you keep your 403(b) plan healthy.

Be aware of common mistakes.

As a 403(b) plan sponsor, it’s important to know the tax rules that apply to your 403(b) plan and to pay attention to the operation of your plan so you can:

maximize your employees’ retirement benefits,
comply with the law, and
avoid additional taxes and penalties.

*Unless otherwise stated, references to 403(b) annuities in this publication will generally also apply to 403(b) custodial accounts.

sponsor a 403(b) plan.

Universal availability. If you allow one employee to make elective deferrals, you must allow all

and non-resident aliens. You must notify employees of their eligibility to make an initial or change an existing deferral election at least once a year.

Depositing elective deferrals. You must send your employees’ deferrals to their annuity providers as soon as is reasonable for proper plan administration (but no later than 15 days following the month of the pay date). If your plan provides an earlier time for transferring elective deferrals, you must follow it.

Excess elective deferrals. The general limit on employee elective deferrals is $19,500 (in 2021, indexed for inflation). If the plan allows, eligible employees may also make catch-up contributions.

15-years-of-service catch-up contribution
available for certain employers (such as schools, hospitals and churches)
employee must have 15 years of service
limited to least of:
$3,000,
$15,000 less previously excluded special catch-ups, or
$5,000 multiplied by years of service minus previously excluded deferrals
Age-50 catch-up contribution
additional $6,500 (in 2021, indexed for inflation)

Catch-up contributions must be applied to the 15-years-of-service catch-up (if available) before being applied to the age-50 catch-up. See 403(b) Contribution Limits for examples of how the ordering works.

distributions from all vendors exceed the amount of the hardship.

Post-severance contributions. Plans may allow for elective deferrals and employer contributions after an employee separates from service.

employment, or 2½ months from the date of severance, if later.

Employer contributions. You may contribute up to the annual limit to a former employee’s account for up to five years following the end of the year they left your employment. (Note: The former employee can’t elect to receive this money in cash instead of depositing it to their 403(b) account.) All contributions must end upon the employee’s death.

In-service exchanges and transfers.

In-service contract exchanges take place within the same plan. The 403(b) plan must permit the movement of the funds and you must follow the plan terms. Benefits can’t be reduced and the moved funds must have at least the same distribution restrictions. You and the receiving annuity issuer must agree to share certain information needed for plan administration.
Plan transfers take place between two 403(b) plans. Both plans must permit the movement of the funds. In addition, the participant must be a current or former employee of the receiving plan sponsor. Benefits can’t be reduced and the moved funds must be subject to at least the same distribution restrictions.

If you find a mistake in your 403(b) plan, take steps to bring it into compliance so your employees can continue to save for retirement on a tax-favored basis. You need to timely correct plan mistakes to avoid additional taxes and penalties that may affect you and your employees. Consider contacting a tax professional for help. You can correct most 403(b) plan mistakes using IRS correction programs. See Correcting Plan Errors for additional information.

Publication 4546, 403(b) Plan Checklist

Visit www.irs.gov/retirement for online resources covering retirement plans (including 403(b) plans). This site has tools such as:

the 403(b) Plan Fix-It Guide,
answers to frequently asked questions, and
a page devoted to correction programs to assist you in correcting errors if you discover them in the operation of your plan.

Publication 4483 (Rev. 8-2021) Catalog Number 47243V Department of the Treasury Internal Revenue Service www.irs.gov