> Who is eligible to participate?
>Do I have to participate?
>May I participate in other retirement plans in addition to this program?
>What happens to the money I contribute to the program?
>Who owns my deferred compensation funds?
>Are there limits on the amount I defer?
>Can I withdraw my money from the program at any time while I’m still employed?
>What constitutes an “unforeseeable emergency”?
>What happens if I separate service from my employer or retire?
>When will I have to pay Federal income taxes on my deferred compensation account?
>Does participation in this program guarantee that I will pay fewer taxes?


Q: Who is eligible to participate?
A: All full-time and part-time benefits-eligible employees of Johnson County government can enroll to defer a portion of compensation each pay period.

Q: Do I have to participate?
A: No. Participation in this program is entirely voluntary. You decide if you want to contribute to the plan. Also, depending on the limits set by your plan, you decide how much you want to contribute and how long you want to contribute. Remember, this is a retirement savings program that requires a long-term commitment of funds.

Q: May I participate in other retirement plans in addition to this program?
A: Yes. Your participation in this program does not exclude you from being eligible to participate in other plans. Consult your tax advisor regarding your particular situation.
Your contributions to one plan may limit the amount you can contribute to another.

Q: What happens to the money I contribute to the program?
A: When you authorize your employer to defer a portion of your compensation to the program, you also select the funding option(s) you prefer and how you would like to direct your deferrals among those options. Your deferrals will accumulate and earnings will be credited based on the performance of the options you have selected.

Q: Who owns my deferred compensation funds?
A: Your employer owns the assets in the deferred compensation plan until they are distributed or made available to plan participants. The employer must retain ownership of the assets until this time to preserve the tax-deferred status of the plan.

Q: Are there limits on the amount I defer?
A: Effective January 1, 2006, the deferral amount is $15,000 per year or 100% of taxable income (less 457 deferrals), whichever is less. There are also "catch up" provisions for individuals over age 50 or who are nearing retirement. 

Q: Can I withdraw my money from the program at any time while I’m still employed?
A: No. According to the Plan Document, you are not permitted to withdraw funds while you are employed by the County unless: 1) you experience an approved unforeseeable emergency, or 2) you have attained age 70½ and elect to begin distributions (you must discontinue deferrals to the plan in this situation). Otherwise, your account values are payable only when you retire, terminate from the County, or die. In the event of your death, your beneficiary of record will receive your benefit payments.

Q: What constitutes an “unforeseeable emergency”?
A: Emergencies 1) for which you cannot ordinarily budget; and 2) that result in severe financial hardship for the participant may qualify. Examples are serious illness or injury to the participant or dependent which creates severe financial hardship, or personal property losses requiring funds over and above what may be covered by insurance. The facts are considered in each separate set of circumstances, and are measured against IRS standards to determine if a true financial emergency exists. Such determination is final. Expenses such as school tuition, the purchase of a car or home, minor emergencies such as car repair, appliance replacement or maintenance are not considered unforeseeable emergencies. You must apply for a withdrawal of funds to meet an unforeseeable emergency, and only for the amount needed to meet the unforeseeable emergency.

Q: What happens if I separate service from my employer or retire?
A: Once you separate from service, you may no longer make contributions to the plan. However, you may begin the distribution of your account immediately and receive the value of your account, less any taxes and other applicable charges, whether in a lump sum or over a period of time provided you have filed your election with Nationwide or ICMA, the plan administrators.

Effective January 1, 1989, distribution of the funds from your deferred compensation account may begin no later than April 1st of the year following the calendar year in which you separate from service or attain age 70½, whichever comes earlier. If you reach the age of 70½ and are still employed, you may continue deferring to the plan until you terminate employment or you may initiate distribution. However, if you have reached age 70½ and choose to initiate distributions while still employed, you may not continue to contribute to the plan.

Q: When will I have to pay Federal income taxes on my deferred compensation account?
A: Income taxes will be payable in the year or years in which your accumulated deferred compensation account is paid or made available to you or your beneficiary. Taxes are only assessed on the amounts made available in any given tax year.

You may find that periodic benefit payments are preferable to a lump-sum payment for tax purposes. Your accountant, attorney, or tax advisor is best prepared to help you with this decision.

Q: Does participation in this program guarantee that I will pay fewer taxes?
A: Most of us can expect to have less taxable income and to be taxed at a lower rate during retirement than when we are working. If this proves to be true in your case, you may pay less tax. However, this cannot be guaranteed for any individual, nor can future tax rates be predicted.