No. ______

RECOMMENDED ACTION – Approval of Amendment to 403(b) Plan Document

The following resolution was moved by _______________________________________
and seconded by _____________________________________:

WHEREAS, the current 403(b) Plan must be revised to be in compliance with additional rules recently set forth by the Internal Revenue Service and Treasury Department and to be effective January 1, 2009,

AND WHEREAS, an appropriate amendment has been added to the existing plan information,

BE IT RESOLVED by the Board of Governors for Missouri State University that the Amendment (attached) to the “Restatement of Missouri State University Code Section 403(b) Plan” becomes effective on the approval date.

VOTE: Aye ____
                       Nay ____

COMMENTS:

The Internal Revenue Service has issued additional new language pertaining to 403(b) retirement plans.  The new language requires the University’s plan to be amended and incorporate the following three items. 
• New Section 3A adds to the Plan the contribution limitations of Section 415 of the Internal Revenue Code.  Essentially, this provision adds a $49,000 limit on annual contributions to the Plan (age 50 catch up contributions which, for 2009, are $5,500 and are in addition to this limit), and this amount includes the separate elective deferral limitation which, for 2009, is $16,500.
• New Section 2A.3 (e) and (f) is an administrative change that requires a participant to provide the Plan with tax basis information in the event of a Roth rollover to the Plan by a participant.  A Roth rollover will need to be kept in a separate account.
• Section 5.1 is revised to include reference to a qualified reservist distribution.

 

AMENDMENT TO RESTATEMENT OF MISSOURI STATE UNIVERSITY CODE § 403(b) PLAN

 This Amendment, made and entered into as of the _19th_ day of _June,_ 2009, by the Board of Governors for Missouri State University.

 WHEREAS, the Board of Governors for Missouri State University (the “Employer”) has established the Missouri State University Code § 403(b) Plan (the “Plan”), and desires to amend the Plan as provided in Section 8.2 of the Plan.

 NOW, THEREFORE, the Employer amends the Plan as follows:
 
1.  Section 3A is added to the Plan to read as follows:

SECTION 3A
LIMITATIONS ON ANNUAL ADDITIONS
 
  3A.1.1   General Limitation on Annual Additions.  A Participant  cannot receive an allocation for a Limitation Year greater than the Maximum Annual Addition as set forth in section 3A.2.4  below.

  3A.1.2   Aggregation of Section 403(b) Contracts.  All Section 403(b) Annuity Contracts purchased by the Employer (including plans       purchased through compensation reduction elections) for the Participant are treated as one section 403(b) Annuity Contract and contributions received under all section 403(b) Annuity Contracts of the Employer will be aggregated for purposes of this Section 3A.  For purposes of this section, the term “Annuity Contract” includes Custodial Accounts maintained pursuant to section 403(b) of the Code.  Contributions made for a Participant are aggregated to the extent applicable under section 414(b) and (c) (each as modified by section 415(h) of the Code).

  3A.1.3   Aggregation where Participant is in Control of Employer.  If a Participant receives an allocation under an Annuity Contract and such Participant is in control of any employer for a Limitation Year, the Annuity Contract will be considered a defined contribution plan maintained by both the controlled employer and the Participant for such Limitation Year. Accordingly, the Annuity Contract will be aggregated with all       defined contribution plans maintained by the controlled employer and the limitations of section 415(c) will be applied in the aggregate to all annual additions allocated to the Participant in the Annuity Contract and all other defined contribution plans of the controlled employer.  For purposes of this paragraph, a Participant is in control of an employer based upon the rules of section 414(b) and 414(c) (each as modified by section 415(h) of the Code).

  3A.1.4    Coordination of Limitation on Annual Additions Where Employer Maintains a Section 403(b) Prototype Plan or Participant is in Control of Employer.  The Annual Additions which may be credited to a Participant’s Account under this Plan for any Limitation Year will not exceed the Maximum Annual Addition under section 3A.2.4, reduced by the Annual Additions credited to the Participant’s Account under any section 403(b) prototype plans maintained by the Employer in addition to this Plan and under any defined contribution plans maintained by an employer that is controlled by the Participant, provided in the later case that the Administrator receives sufficient information from the Participant concerning his or her participation in such defined contribution plan.  The contributions allocated to the Participant’s Account under this Plan will be reduced to the extent necessary to prevent this limitation from being exceeded.

  3A.1.5    Excess Annual Additions.

      (a) Notwithstanding Section 3 and sections 3A.1.1 through  3A.1.4, if a participant’s Annual Additions under this Plan, or under this Plan and any section 403(b) prototype plans maintained by the Employer and any defined contribution plans maintained by an employer controlled by the Participant, result in an excess Annual Addition for a Limitation Year, the excess Annual Addition will be deemed to consist of the Annual Additions last allocated, except Annual Additions to a defined contribution plan maintained by an employer controlled by the Participant will be deemed to have been allocated first.

      (b)    If an excess Annual Addition was allocated to a Participant on an allocation date of this Plan which coincides with an allocation date of a section 403(b) Prototype Plan maintained by the Employer, the excess Annual Addition attributable to this Plan will be the product of:

        (i) the total excess Annual Addition allocated as of such date, times
    
        (ii) the ratio of (i) the Annual Additions allocated to the participant for the Limitation Year as of such date under this Plan to (ii) the total Annual Additions allocated to the participant for the Limitation Year as of such date under this and all section 403(b) Prototype Plans maintained by the Employer.

      (c) Any excess Annual Addition attributable to this Plan will be corrected in the manner described in section 3A.

  3A.1.6     Coordination of Limitation on Annual Additions Where Employer Maintains a Section 403(b) Plan that is Not a Prototype Plan.  If the Participant is covered under another  section 403(b) plan maintained by the Employer which is not a section 403(b) Prototype Plan, Annual Additions which may be credited to the Participant’s account under this Plan for any Limitation Year will be limited in accordance with sections 3A.1.4 and 3A.1.5 as though the other plan were a section 403(b) Prototype Plan.

  3A.1.7     Correction of Excess Annual Additions.  The portion of the section 403(b) contract that includes the excess Annual
       Additions attributable to this Plan fails to be a Section 403(b) Annuity Contract and the remaining portion of the contract is a Section 403(b) Annuity Contract.  The issuer of the section 403(b) contract that includes the Excess Annual Addition shall maintain a separate account for such Excess Annual Addition for the year of the excess and for each year thereafter.  In the case where a Participant is in control of an employer and the Excess Annual Addition needs to be maintained in a separate account under this Plan, the Administrator shall only be required to establish such separate account if it receives sufficient information from the Participant concerning his or her participation in such other defined contribution plan controlled by the Participant.

  Definitions

  3A.2.1     Annual Additions.  The sum of the following amounts credited to a Participant’s Account for the Limitation Year under this Plan, any other section 403(b) plan of the Employer, or a defined contribution plan maintained by an Employer controlled by the Participant:

     (a) Employer contributions;

     (b) Employee contributions; and

     (c) forfeitures, if any.

  3A.2.2     Includible Compensation

       (a) “Includible Compensation” for purposes of this Section 3A means an Employee’s compensation received from the Employer that is includible in the Participant’s gross income for Federal income tax purposes (computed without regard to section 911 of the Code relating to United States citizens or residents living abroad) for the most recent period that is a Year of Service.  Includible Compensation also includes any elective deferral or other amount contributed or deferred by the Employer at the election of the Employee that would be includible in gross income but for the rules of section 125, 132(f)(4), 402(e)(3), 402(h)(1)(B), 402(k), or 457(b) of the Internal Revenue Code.  The amount of Includible Compensation is determined without regard to any community property laws.  The amount of Includible Compensation of each Participant taken into account in determining contributions shall not exceed $245,000, as adjusted for cost-of-living increases in accordance with section 401(a)(17)(B) of the Code for periods after 2009.

       (b) For purposes of applying the limitations on Annual Additions to nonelective employer contributions pursuant to section 415 of the Code, Includible Compensation for a Participant who is permanently and totally disabled (as defined in section 22(e)(3) of the Code) is the compensation such Participant would have received for the Limitation Year if the Participant had been paid at the rate of compensation paid immediately before becoming permanently and totally disabled.

  3A.2.3.     Limitation Year.  The Limitation Year means the Plan Year. However, if the Participant is in control of an Employer pursuant to section 3A.1.3 above, the Limitation Year shall be the Limitation Year in the defined contribution plan controlled by the Participant.

  3A.2.4     Maximum Annual Additions.  Except for Age 50 Catch up contributions described in Code section 414(v) of the Code, the Annual Addition that may be contributed or allocated to a Participant’s account under the Plan for any Limitation Year shall not exceed the lesser of:

      (a) $49,000, as adjusted for increases in the cost-of-living
under § 415(d) of the Code for periods after 2009, or

      (b) 100 percent of the Participant’s Includible Compensation
for the Limitation Year.

3A.2.5     The Includible Compensation limit referred to in 3A.2.4(b) shall not apply to any contribution for medical benefits after separation from service (within the meaning of section 401(h) or section 419A(f)(2) of the Code) which is otherwise treated as an Annual Addition.

3A.2.6     Section 403(b) Prototype Plan.  A Section 403(b) Prototype Plan means a section 403(b) plan the form of which is the subject of a favorable opinion letter from the Internal Revenue Service.

3A.2.7     Employer.  Solely for purposes of 3A sections 1 and 2, “Employer” means the employer that has adopted the Plan and any employer required to be aggregated with that employer under section 414(b) and (c) (each as modified by section 415(h)), (m), (o), of the Code and section 1.414(c)-5 of the Treasury Regulations.

 2. Section 2A of the Plan is amended so as to add thereto the following Sections 2A.3(e) and 2A.3(f), to read as follows:

  2A.3(e)    A rollover of an eligible rollover distribution that includes Roth elective deferrals will only be accepted if the Plan Administrator        obtains information regarding the Participant’s tax basis under section 72 of the Code in the amount rolled over. 

  2A.3(f)    Separate accounts shall be established and maintained for the Participant for any eligible rollover distribution paid to the Plan. 

 3. Section 5.1 of the Plan is amended to read as follows:

  5.1     Benefit Distributions at Severance from Employment or Other Distribution Event.  Except as permitted in the case of excess Elective Deferrals, amounts rolled over into the Plan, a distribution made in the event of hardship, a qualified reservist distribution as defined in section 72(t)(2)(G) of the Code, or termination of the Plan, distributions from a Participant’s Account may not be made earlier than the date on which the Participant has a Severance from Employment, dies, becomes disabled (within the meaning of section 72(m)(7) of the Code), or attains age 59-1/2.  Distributions shall otherwise be made in accordance with the terms of the Individual Agreements.

 4. This Amendment shall be effective as of January 1, 2009.

 IN WITNESS WHEREOF, the Board of Governors for Missouri State University has executed this Amendment as of the day and year first above written.

      BOARD OF GOVERNORS FOR
      MISSOURI STATE UNIVERSITY

      
      By:________________________________
      Title:_______________________________