International Ministerial Fellowship
403(b)(9) Church Summary Plan Description
TABLE OF CONTENTS
SUMMARY PLAN DESCRIPTION
INTRODUCTION
DIRECTORY
1.0 PARTICIPATION
1.1 Eligibility rules
1.2 Normal retirement age
1.3 Normal retirement date
1.4 Service rules for participation
2.0 403(b) ELECTIVE CONTRIBUTIONS
2.1 Amount
2.2 Tax incentives
2.3 Changing your elective contribution
3.0 MATCHING CONTRIBUTIONS
4.0 BASIC CONTRIBUTIONS
4.1 Amount
5.0 DIRECT ROLLOVER/TRANSFERS FROM OTHER EMPLOYER PLANS
5.1 Direct
rollover/transfers from other plans
6.0 YOUR ACCOUNTS
6.1 Participant accounts
6.2 Investments
7.0 IN-SERVICE WITHDRAWALS
7.1 Withdrawals before age 59-1/2
7.2 Withdrawals after age 59-1/2
7.3 Taxes on withdrawals
7.4 Withdrawals for financial hardship
8.0 LOANS
8.1 Loans
9.0 DISTRIBUTIONS
9.1 Distributions
9.2 Direct transfers
10.0 VESTING AND PAYMENTS UPON DEATH
10.1 Vesting
10.2 Forms of payment
10.3 Spousal consent
10.4 Taxes on distributions
10.5 Postponed payment
10.6 Death
10.7 Designating your beneficiary
11.0 ADDITIONAL INFORMATION
11.1 Non-Assignment of benefits
11.2 Claims review procedure
11.3 Plan insurance
11.4 Future of the plan
11.5 Your rights under federal law
SUMMARY PLAN DESCRIPTION
This Summary Plan Description will tell you about the International Ministerial Fellowship Section 403(b)(9) Retirement Plan and the plan design elements that are specific to International Ministerial Fellowship. It is a summary of the Plan in simple language and does not give you all the details on all aspects of the Plan. The actual terms of the Plan are contained in the Plan Document, the legal document that governs your rights and benefits under the Plan. In the event of any conflict between the terms of the Plan Document and the Summary Plan Description, the terms of the Plan Document will control. The Plan Document and other legal documents relating to the Plan are available for inspection by participants and their beneficiaries upon request to the Plan Administrator.
You should read this Summary Plan Description (SPD) carefully. We want you to understand the way the International Ministerial Fellowship 403(b)(9) Retirement Plan works. If you have a specific question about how the plan applies to you, you should consult the Plan Administrator.
INTRODUCTION
Saving for retirement. We all know it’s important, but it’s not easy with today’s high living expenses and taxes. To help you save for your retirement, International Ministerial Fellowship has established this Section 403(b)(9)Retirement Plan. The plan can help you save in two important ways.
First, there are tax incentives. This may enable you to save a greater amount toward retirement than you could otherwise. The tax incentives differ based on the type of account chosen, Traditional or Roth. Both investment choices are discussed in detail later in this SPD.
Second, earnings on your elective contributions, matching contributions and basic contributions may also be tax deferred. If so, you pay no income taxes until the funds are distributed to you. In the meantime, earnings on the funds compound tax-free. This means that your effective rate of return on contributions under the plan will be greater than with a taxable investment outside the plan earning at the same rate.
DIRECTORY
Adopting Employer International Ministerial Fellowship
(763)571-5967
Federal Employer Identification Number 36-343-1230
Plan Administrator International Ministerial Fellowship
is the Plan Administrator.
The person to contact Frank Masserano
(763)571-5967
Agent for service of legal process The agent for service of legal process
is the Plan Administrator.
Plan Number 001
Plan Year January 1 through December 31
1.0 PARTICIPATION
1.1 Eligibility rules. All employees are eligible to participate in the plan on an Elective Deferral (Voluntary Contributions) basis upon hire.
You will enter the employer basic contribution portion of the plan (when applicable) on the first entry date after you complete 1 year of service and you reach age 21.
The plan provides for daily entry dates.
1.2 Normal retirement age. Your Normal Retirement Age (NRA) is the day you reach age 65.
1.3 Normal retirement date. Your Normal Retirement Date is the first day of the month coinciding with or next following NRA.
1.4 Service rules for participation. Your years of service are used to determine when you are eligible to participate in the plan and the amount of your vested interest in the plan if you terminate employment before retirement. You earn a year of service for participation if you are credited with 1,000 or more hours of service in an “employment period.” An employment year is the 12-month period starting on your date of hire or on an anniversary of your date of hire. A year of service is not completed before the end of your employment year regardless of when during the 12-month period you complete 1,000 hours.
Hours of service include all hours for which you are paid for working. Paid nonworking hours (such as vacation, illness or back pay awards), and non-paid time on authorized leave of absence or leave for required military service, also count as hours of service.
2.0 403(b) ELECTIVE CONTRIBUTIONS
2.1 Amount. You decide how much you want to save in the plan. You can choose any whole percentage of your pay, up to 100% of your compensation, but not more than $15,500 in any calendar year. (This amount increases annually. You should check with your Plan Administrator to ascertain the correct limit each year. This amount also may be reduced to the extent that International Ministerial Fellowship makes basic or matching contributions on your behalf.) Each pay period, the percentage or amount you have chosen is taken from your pay and deposited into your 403(b) plan account.
Participants who have reached age 50, veterans returning from the service in the uniformed services, and employees of churches, conventions or associations of churches, educational institutions (schools, colleges, and universities), hospitals, home health service agencies, and health and welfare service agencies may choose to save additional amounts. Check with your Plan Administrator to learn more about these rules.
In addition, the amount of elective contributions that you make to other plans (e.g., §401(k) plans), including plans maintained by other employers, will reduce the limit on the amount of your elective contributions to this plan. Normally, total contributions to the plan may not exceed your compensation for the current year. There are also special rules that may limit §403(b) contributions by highly paid employees in certain circumstances. The Plan Administrator will notify you if these rules affect you.
2.2 Tax incentives. Another important taxation distinction as it relates to retirement savings is when money is taxed. There are three potential times of taxation: when money is invested, as it grows, and finally when it is withdrawn.
When money is invested, it can either reduce your total income (pre-tax contributions) or it can be counted as income (after-tax contributions). The division is determined by whether the contributions are coded as Traditional contributions (pre-tax contributions) or Roth contributions (after-tax contributions).
In a Traditional account, the money being contributed reduces your income and thus reduces the taxes paid on your income. In a Roth account, the money invested is still considered income. The contributions are made with after-tax income.
In both the Traditional account and the Roth account, monies grow tax-deferred. In other words, no taxes are collected while the funds are invested.
The advantage of a Roth account is in the distribution phase. Distributions are not taxed, as long as certain conditions are met. In Traditional accounts, as monies are distributed, they will be taxed as ordinary income. The following table summarizes the differences between Roth and Traditional contributions:
Account Type Contributions Growth Distributions
Roth 403(b) Taxed (Reported on W2)* Not Taxed Not Taxed
Traditional 403(b) Not Taxed (Excluded from W2) Not Taxed Taxed
2.3 Changing your elective contribution. You can increase or decrease a previous contribution election. If you choose to do so, your new §403(b) deposit will go into effect with the first payroll period that is not more than thirty days after you notify the Plan Administrator.
You may stop making §403(b) deposits for any reason. Your elective contributions will stop with the first payroll period that is not more than thirty days after you notify the Plan Administrator.
3.0 MATCHING CONTRIBUTIONS. There are no employer matching contributions associated with this plan.
4.0 BASIC CONTRIBUTIONS
4.1 Amount. For each plan year, contributions may be made by International Ministerial Fellowship for the benefit of any employee so designated by the Board of Directors.
5.0 DIRECT ROLLOVER/TRANSFERS FROM OTHER EMPLOYER PLANS
5.1 Direct rollover/transfers from other plans. You may rollover or transfer amounts tax-free to this plan directly from another qualified retirement plan or §403(b) plan or funding vehicle, or an individual retirement arrangement (IRA). By taking advantage of this opportunity, you can defer paying taxes on the amount you transfer into the plan and continue to accumulate tax-sheltered earnings.
A rollover or transfer is subject to special IRS requirements. Please consult the Plan Administrator for more information on making a direct rollover or transfer.
6.0 YOUR ACCOUNTS
6.1 Participant accounts. Contributions to the plan on your behalf are credited to a participant account in your name.
6.2 Investments. The accounts of all participants in this plan are held in mutual fund accounts maintained on behalf of the plan by UMB Bank, Custodian (Lincoln Investment Planning, Inc. Administrator). You direct the investment of your plan account among the investment choices available under the program. Please contact the Plan Administrator for information describing your investment choices.
7.0 IN-SERVICE WITHDRAWALS
7.1 Withdrawals before age 59-1/2. Withdrawals from your elective contribution account or §403(b)(7) custodial account are prohibited prior to attaining age 59-1/2 except in the case of death, disability, separation from service, or financial hardship. Except for your pre-1989 account balance (if any), distributions on account of financial hardship are limited to your elective contributions. Investment earnings on elective contributions are not eligible for hardship withdrawal after 1988.
7.2 Withdrawals after age 59-1/2. You may make a withdrawal for any reason from the following account(s) after age 59-1/2; financial hardship is not necessary:
• Your elective contribution account
• Your employer basic contribution account
• If you wish to make a withdrawal, contact the Plan Administrator
7.3 Taxes on withdrawals. A withdrawal is taxable as ordinary income unless it is rolled over to another §403(b) plan or IRA. You do not pay income taxes when the money is contributed to the plan: instead, you pay taxes on the money that you take out.
In addition to income tax, a withdrawal or distribution before age 59-1/2 may be subject to a 10% penalty tax unless:
• Payment is made as a result of total disability or death;
• Payment is made to you, beginning after your separation from service, in substantially equal installments over your life expectancy or the combined life expectancy of you and your designated beneficiary;
• You separate from service after age 55;
• The amount of the withdrawal does not exceed your deductible medical expenses (determined without regard to the “floor” of 7.5% of adjusted gross income or whether you itemize your deductions) in the year of withdrawal; or
• The distribution is made to an alternate payee under a qualified domestic relations order.
7.4 Withdrawals for financial hardship. The purpose of this plan is to help you
accumulate financial resources for retirement needs. (However, in the event of an unforeseen
emergency, you may generally withdraw all or part of your elective account
balance.) However, for plan years
beginning after 1988, a distribution for financial hardship from your 403(b)
elective contributions account is limited to your elective contributions for
all plan years and any income allocable to that account as of
An unforeseen emergency is an immediate and heavy financial need for which your do not have other reasonably available resources to meet the need. Usually medical costs, next year’s college tuition for you or your dependents, payment of rent or mortgage payments to prevent eviction or foreclosure on your primary residence, or the initial purchase of your primary residence satisfy these requirements, provided you do not have other reasonably available resources. If you wish to apply for a hardship withdrawal, please see the Plan Administrator.
8.0 LOANS
8.1 Loans. In order to assist you in the event of a financial hardship, the plan lets you borrow from your plan accounts. Loans are available to all participants.
You do not pay federal income taxes on the loan, even though you are receiving the use of money that has not yet been federally taxed. From this standpoint, a loan is better than a withdrawal. However, you do pay interest on the loan, but the interest you pay goes back into your account (less any administrative charges). The interest rate for loans will be set by the provider in accordance with current rules, regulations, and policy.
The amount that you may borrow cannot exceed the lesser of 50% of your vested account balance or $50,000.00. (However, loans cannot be made from any part of your account balance that is held in a “custodial account” invested in “regulated investment company” (mutual fund) stock.) If you obtain a loan, your account balances will be used as security. If you are currently employed, you will have to repay the loan with interest. This withholding may be accomplished by ACH or paycheck withholding, depending on the applicable procedures of the custodian. The loan term may not exceed 5 years unless the loan is used to acquire your principal residence (in which case your loan term may not exceed 30 years). If you are not currently employed, you must make regular payments to the Plan Administrator at least monthly, or quarterly, depending on the policy of the custodian.
The minimum amount you may borrow is $1,000. Specific rules for loans, including length of the loan, the maximum amount you are permitted to borrow and procedures for applying for a loan, are available from the Plan Administrator.
DEFAULT WILL OCCUR IF YOU, THE BORROWER, FAIL TO PAY ON THE PRINCIPAL AND/OR INTEREST IN ANY PERIOD. IF YOU DEFAULT ON YOUR LOAN, YOU WILL BE SUBJECT TO FEDERAL INCOME TAXES ON THE AMOUNT IN DEFAULT AND MAY BE SUBJECT TO THE ADDITIONAL 10% FEDERAL INCOME TAX.
9.0 DISTRIBUTIONS
9.1 Distributions. You are eligible to receive the vested amount in your participant account when your employment terminates. At your election, payment will be made as soon as reasonably possible after the next valuation date following your termination of employment unless you make an election to postpone payment to a later date but generally no later than April 1 following the year in which you attain age 70-1/2.
9.2 Direct transfers. You have the right to ask the Plan Administrator to transfer the amount of any non-annuity type distribution directly to an IRA, a qualified plan, or another §403(b) plan. This avoids a mandatory 20% income tax withholding requirement.
10.0 VESTING AND PAYMENTS UPON DEATH
10.1 Vesting. You are always fully vested in your rollover/direct transfer account and your elective contributions account.
10.2 Forms of payment. You may elect the form of payment in which your account is paid to you. Payment may be in one of the following methods:
• One or more payments within one year;
• Installment payments over a period you select, which generally may not be longer than your life expectancy or the combined life expectancies of you and your designated beneficiary; other limits may apply in certain cases; or
• An annuity providing payments over your lifetime or the lifetimes of you and your designated beneficiary.
10.3 Spousal consent. If you are married, your spouse must consent in writing to any form of payment other than an annuity providing your spouse with a survivor benefit equal to 50% of the amount of the benefit paid during your lifetime. Spousal consent is required by law.
10.4 Taxes on distributions. A distribution to you (or an in-service withdrawal for financial hardship) that is not rolled over is taxable as income. Since you did not pay taxes on employer contributions and elective deferrals to your account when they were made, you must pay taxes on the money when it is distributed to you. In addition to a regular income tax, a distribution before age 59-1/2 may be subject to a 10% penalty tax.
You will receive more information about the taxes on a distribution, including information on deferring taxes by rolling the information over to an IRA or another employer’s 403(b) plan shortly before you receive your distribution.
10.5 Postponed payment. If you account balance is greater than $5,000, you can postpone the payment of benefits until the April 1 following the later of (1) the year in which you reach age 70-1/2 or (2) the year in which you terminate employment with International Ministerial Fellowship. The actual required beginning date for payments is prescribed by the minimum distribution rules under 401(a)(9) of the Internal Revenue Code.
10.6 Death. If you die during your employment with International Ministerial Fellowship, and if you are married, your spouse will receive a survivor annuity unless your spouse previously signed a notarized consent waiving the right to such an annuity. If you are not married, or your spouse has waived the annuity, your beneficiary will receive your full remaining account balance. If you die after your employment with International Ministerial Fellowship, your spouse or other beneficiary will receive your remaining account balance.
10.7 Designating your beneficiary. You should designate your beneficiary or beneficiaries in writing on a form filed with the Plan Administrator. If you are married, your spouse is automatically your sole beneficiary unless your spouse consents in writing to the designation of another beneficiary. Your spouse is entitled to a joint and 50% survivor annuity, unless your spouse agrees to another form of distribution or beneficiary.
11.0 ADDITIONAL INFORMATION
11.1 Non-Assignment of benefits. Your benefits under this plan may not be assigned, sold, or used as collateral, nor in most cases may a creditor attach your account as a means of collecting a debt owed by you. This protects your participant account from the claims of most creditors you may have. However, a court may issue an order requiring that all or part of your account be paid to your former spouse or a dependent as alimony or support. The plan would have to obey a proper order.
11.2 Claims review procedure. If you or your beneficiary do not receive a distribution when due, or you have another claim under the plan, you should file a written claim with the Plan Administrator. The Plan Administrator will then check the validity of the claim and take the necessary steps to resolve the problem. If additional information is necessary to process your claim, you will be told what is needed.
If your claim is denied in whole or in part, you will be notified in writing within a reasonable period of time after receipt of your claim. The notice of denial will include the specific reasons for denial and references to the plan provisions on which the denial was based.
Within 60 days after receiving a denial, you or your authorized representatives may appeal the decision by filing a written request for review with the Plan Administrator. In connection with your appeal, you may review pertinent plan documents and submit issues and comments in writing.
The Plan Administrator will give a written decision on your appeal after giving it full consideration.
11.3 Plan insurance. Your account under this plan is not insured by the Pension Benefit Guaranty Corporation (PBGC) if the plan should terminate. The PBGC insures only defined benefit plans. This plan is a defined contribution plan that is not covered by the PBGC.
11.4 Future of the plan. International Ministerial Fellowship expects to continue the plan indefinitely. However, since future conditions cannot be foreseen, International Ministerial Fellowship reserves the right to amend or discontinue the plan. If the plan is ever terminated, you will be fully vested in all amounts credited to your account.
11.5 Your rights under Federal law. The Employee Retirement Income Security Act of 1974 (ERISA) does not apply to Church Plans.
(a) Information about your plan and
benefits.
(1) You are entitled to examine without charge, the Plan Documents regarding this plan at the Plan Administration Office.
(2) You are entitled to obtain, upon written request to the Plan Administrator, copies of documents governing the operation of the plan. The administrator may make a reasonable charge for the copies.
(3) You are entitled to receive a summary plan description.