The North Carolina 401(k) plan is sponsored by the State of North Carolina and governed by the Department of the State Treasurer. The plan administrator for this program is Prudential. The North Carolina 401(k) Plan is a supplemental retirement plan that allows employees to set aside payroll-deducted contributions on either a tax deferred basis or Roth after-tax basis.
Permanent full-time employees scheduled to work 30 or more hours per work week are eligible to participate.
The annual contribution limit to the 401(k) plan is based on a percentage of your gross pay. You can contribute up to 80% of your gross pay not to exceed $18,000. You may be eligible for a catch-up contribution of an additional $6,000 if you are 50 or older, or will turn 50 during the current calendar year. For employees age 50 or older, the maximum contribution amount is $24,000. Your contributions can be deducted on either a tax deferred basis (reduces your federal and state taxes) or an after-tax basis using a Roth 401(k) account.
Coordination with other Supplemental Plans
An aggregation of 403(b) and 401(k) plan contributions must be made if you participate in more than one supplemental plan during a calendar year. For example, if you contribute to the 401(k) plan in addition to the 403(b) plan, the combined amount of the contribution to both plans in 2015 cannot exceed the elective deferral plan limit of $18,000. The age 50 catch-up is also a combined amount with the 403(b) program.
Contributions to a 457(b) deferred compensation plan are not aggregated with 403(b) or 401(k) plan limits.
Vesting & Loans
You are immediately 100 percent vested in the value of your employee contributions. You may be able to borrow against your account; contact Prudential for more information about loan provisions.
Generally, distributions from a 401(k) Plan can be made when an employee reaches age 59 1/2, severs employment, becomes disabled or dies. In most cases, payments received from a 401(k) account are taxed as ordinary income and may be subject to an additional penalty.
Prudential makes available optional forms of payments and a variety of retirement payment options designed to allow you to tailor-make your retirement program to meet your financial needs. These may be fixed payments or payments on a variable basis, or a combination of payment options. You may also elect to receive a lump sum distribution.