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For over 20 years, distributions from 403(b) tax-sheltered annuity arrangements were only allowed to be rolled into an IRA or another 403(b) plan. As of 2002, rollovers from 403(b) plans to qualified plans are possible as a result of the enactment of the Economic Growth and Tax Relief Reconciliation Act (EGTRRA) in 2001. EGTRRA also extended the right to rollover distributions from 403(b) plans to governmental deferred compensation plans under Code Section 457. Finally, EGTRRA now permits the rollover of qualified plans, governmental 457 plans and traditional IRAs (pre-tax money only) into 403(b) plans that have been amended for EGTRRA to accept these rollovers. To make a rollover of assets from a 403(b) plan, a distributable event must first occur. A distributable event includes, but is not limited to termination of service, death or disability. In addition, the eligible rollover distribution rules still apply. However, 403(b) plans do not have plan termination as a distributable event. Therefore, although a 403(b) plan may be terminated and a 401(k) plan established; the assets in the 403(b) plan may not be rolled into the 401(k). The rollover can only occur participant by participant as each participant has a distributable event such as termination of service, death or disability. Keep in mind that the amounts to be rolled over must also be eligible rollover distribution amounts. This means that distributions that occur due to required minimum distribution requirements, amounts paid over a life expectancy or in a series of payments over 10 years or longer and hardship withdrawals from a 403(b) are not eligible for rollover.
To summarize, EGTRRA allows the following 403(b) rollover transactions for the first time as of 2002:
►		A traditional, pre-tax IRA may be rolled into a 403(b) plan.
►		A SEP IRA may be rolled into a 403(b) plan.
►		A SIMPLE IRA may be rolled into a 403(b) after two years of participation in the SIMPLE IRA when the 25% premature distribution penalty no longer applies.
►		A governmental 457(b) plan may be rolled to a 403(b) plan.
►		A 403(b) may be rolled into a SEP, governmental 457 or qualified plan.
►		Pre-tax qualified plan assets, as described in 401(a) or 403(a), may be rolled into a 403(b).
►		After-tax qualified plan assets may be moved by direct-rollover into a 403(b).
►		Surviving spouses who receive eligible rollover distributions can roll these amounts into a 403(b).

However, the following transactions still may NOT occur:
►		403(b) assets may NOT be rolled into SIMPLE plans or Roth IRAs. (Assets from these plans may be rolled into a traditional IRA and from there, considered for conversion to a Roth IRA.)
►		After-tax contributions in an IRA may not be rolled to any plan except another IRA.
►		After-tax qualified plan assets may not be rolled over by the participant to a 403(b), but they may be direct trustee-to-trustee transferred to another qualified plan.
►		After-tax , non-deductible contributions made to an IRA may not be rolled into 403(b) plan.

For more 403(b) information, why not attend one of our 403(b) e-seminars. Click here for details on our 403(b) e-seminar.
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