When You Can Access Your Funds

Once you are no longer a City employee (retirees hired as provisional are considered termed employees for distribution purposes), you can have access to your SPSP or SPSP-H account. Note, however, that due to the timing of your separation and when electronic files are sent to Principal, it may take between two to four weeks for Principal to have your separation documented in their system.

Distribution Options

As long as there is more than $5,000 in your SPSP account, you may leave your money in your account for as long as you want.

• If there is less than $1,000, then the money is paid as cash via check, directly to you.
• If there is more than $1,000 but less than $5,000, and you don't elect a distribution or roll the money over, then Principal will roll the money over to an IRA under your name with Inspira. The contact number for Inspira is, 1-888-261-7687. The balance used to determine if the account will be forced out is based on the vested balance (which includes any Rollover money into the account).

When you would like to take a distribution, funds may be distributed as partial, full lump sum or systematic (monthly/quarterly/semi-annual/annual) withdrawals until funds are depleted. Both employee and employer funds are distributed on a “pro-rata” basis, meaning they are taken proportionately from each type of contribution (employee post-tax, employee pre-tax, and employer pre-tax contributions).

Distributions from your SPSP account are subject to mandatory 20% Federal and appropriate State withholding taxes. Mandatory tax withholding applies to all taxable distributions you receive, with documentation sent annually for tax return preparation.

In addition, the Tax Reform Act of 1986 imposes a 10% penalty tax on early distribution of tax-deferred monies to terminating employees who have not reached the age of 59 1/2. You will be responsible for paying these penalty taxes when you file your income tax returns. However, the 10% tax will not apply if distributions before age 59 ½ are made to a participant after separation from service if the separation occurred during or after the calendar year in which the participant reached age 55 (if you are a public safety employee, separation must occur on or after the calendar year in which you reach age 50 to avoid the early withdrawal penalty).

It is recommended that you consult with a qualified tax advisor to determine whether a distribution of the City's contributions is subject to the early withdrawal penalty. Employee contributions prior to 1/1/2016 are not subject to early withdrawal penalties since they were made on an after-tax basis.

Rollover Options

After separation from City service, only pre-tax assets (employee contributions after Jan. 1, 2016, employer contributions, and all earnings) in the plan may be rolled over to over to either another employer plan (if allowed by the new plan) or an Individual Retirement Account (IRA). In these instances, when received by the new plan, it assumes the new plan's rules (for example, early withdrawal penalties apply if funds are withdrawn from an IRA before age 59½). You also have the option to roll SPSP funds over into the CalPERS 457 Plan after separation; however, the SPSP plan rules would still apply to these funds (i.e. certain early withdrawal penalties). Pre-tax funds may be rolled over to the City of San Diego 401(k) Plan.

Pre-tax transfers from the SPSP plan are reportable to the IRS but not taxable in the year of transfer. Post-tax contributions (employee contributions made prior to Jan. 1, 2016) cannot be transferred. They will be returned to you and that amount is not subject to ordinary income taxes (since they were taxed before being contributed to SPSP).

Future Considerations

No future contributions may be made after leaving City employment, with the exception of continuing loan payments. For the SPSP plan, new loans are not allowed once you have left City employment. You may continue to make payments directly to Wells Fargo on an existing loan. There is no required mandatory distribution necessary until age 70 ½ years of age (or actual retirement age if still actively employed by the City). The IRS mandates the beginning of the Required Minimum Distribution (RMD).

For More Information

Please contact the Principal at 1-800-547-7754 to request a distribution, for a breakdown of pre-tax and post-tax balances, for more information regarding rollovers, or for any questions regarding your account.

When You Can Access Your Funds

Once you are no longer a City employee (retirees hired as provisional are considered termed employees for distribution purposes), you can have access to your 401(a) account. Note, however, that due to the timing of your separation and when electronic files are sent to Principal, it may take between two to four weeks for Principal to have your separation documented in their system.

Distribution Options

As long as there is more than $5,000 in your 401(a) account, you may leave your money in your account for as long as you want.

• If there is less than $1,000 then the money is paid as cash via check, directly to you.
• If there is more than $1,000 but less than $5,000, and you don't elect a distribution or roll the money over, then Principal will roll over the money to an IRA under your name with Inspira. The contact number for Inspira is 1-888-261-7687. The balance used to determine if the account will be forced out is based on the vested balance (which includes any Rollover money into the account).

When you would like to take a distribution, funds may be distributed as partial, full lump sum, or systematic (monthly/quarterly/semi-annual/annual) withdrawals until funds are depleted. All employee and employer funds are distributed on a “pro-rata” basis and all but voluntary employee contributions are taxed as ordinary income. A request can be made to have all pre-tax funds rolled over and the post-tax funds (employee voluntary contributions) paid to you.

Distributions from your 401(a) account are subject to mandatory 20% Federal and appropriate State withholding taxes. Mandatory tax withholding applies to all taxable distributions you receive, with documentation sent annually for tax return preparation.

In addition, the Tax Reform Act of 1986 imposes a 10% penalty tax on early distribution of tax-deferred monies to terminating employees who have not reached the age of 59 ½. You will be responsible for paying these penalty taxes when you file your income tax returns. However, the 10% tax will not apply if distributions before age 59 ½ are made to a participant after separation from service if the separation occurred during or after the calendar year in which the participant reached age 55 (if you are a public safety employee, separation must occur on or after the calendar year in which you reach age 50 to avoid the early withdrawal penalty).

It is recommended that you consult with a qualified tax advisor to determine whether a distribution of the City's contributions is subject to the early withdrawal penalty. Employee voluntary contributions are not subject to early withdrawal penalties since they were made on an after-tax basis.

Rollover Options

After separation from City service, only pre-tax assets (employer contributions, mandatory employee contributions, and all earnings) in the plan may be rolled over to over to either another employer plan (if allowed by the new plan) or an Individual Retirement Account (IRA). In these instances, when received by the new plan, it assumes the new plan's rules (for example, early withdrawal penalties apply if funds are withdrawn from an IRA before age 59½). You also have the option to roll 401(a) funds over into the CalPERS 457 Plan after separation; however, the 401(a) plan rules would still apply to these funds (i.e. certain early withdrawal penalties). Pre-tax funds may also be rolled over to the City of San Diego 401(k) Plan.

Pre-tax transfers are reportable to the IRS but not taxable in the year of transfer. Post-tax (voluntary employee contributions) cannot be transferred. They will be returned to you and that amount is not subject to ordinary income taxes since they were taxed before being contributed to the 401(a).

Future Considerations

No future contributions may be made after leaving City employment. There is no required mandatory distribution necessary until age 70½ years of age (or actual retirement age if still actively employed by the City). The IRS mandates the beginning of the Required Minimum Distribution (RMD).

For More Information

Please contact the Principal at 1-800-547-7754 to request a distribution, for a breakdown of pre-tax and post-tax balances, for more information regarding rollovers, or for any questions regarding your account.

When You Can Access Your Funds

Once you are no longer a City employee (retirees hired as provisional are considered termed employees for distribution purposes), you can have access to your 401(k) account. Note, however, that due to the timing of your separation and when electronic files are sent to Principal, it may take between two to four weeks for Principal to have your separation documented in their system.

Distribution Options

As long as there is more than $5,000 in your 401(k) account, you may leave your money in your account for as long as you want.

• If there is less than $1,000 then the money is paid as cash via check, directly to you.
• If there is more than $1,000 but less than $5,000, and you don't elect a distribution or roll the money over, then Wells Fargo will roll over the money to an IRA under your name with Inspira. The contact number for Inspira is, 1-888-261-7687. The balance used to determine if the account will be forced out is based on the vested balance (which includes any Rollover money into the account).

When you would like to take a distribution, funds may be distributed as a partial, full lump sum, a rollover, or systematic (monthly/quarterly/semi-annual/annual) withdrawals until funds are depleted.

Distributions from your 401(k) account are subject to mandatory 20% Federal and appropriate State withholding taxes. Mandatory tax withholding applies to all taxable distributions you receive, with documentation sent annually for tax return preparation.

In addition, the Tax Reform Act of 1986 imposes a 10% penalty tax on early distribution of tax-deferred monies to terminating employees who have not reached the age of 59 ½. You will be responsible for paying these penalty taxes when you file your income tax returns. However, the 10% tax will not apply if distributions before age 59 ½ are made to a participant after separation from service if the separation occurred during or after the calendar year in which the participant reached age 55 (if you are a public safety employee, separation must occur on or after the calendar year in which you reach age 50 to avoid the early withdrawal penalty).

It is recommended that you consult with a qualified tax advisor to determine whether a distribution of the City's contributions is subject to the early withdrawal penalty.

Rollover Options

Assets in the plan may be rolled over to either another employer plan (if allowed by the new plan) or an Individual Retirement Account (IRA). In these instances, when received by the new plan, it assumes the new plan's rules (for example, early withdrawal penalties apply if funds are withdrawn from an IRA before age 59½). You also have the option to roll 401(k) funds over into the CalPERS 457 Plan after separation; however, the 401(k) plan rules would still apply to these funds (i.e. certain early withdrawal penalties). Transfers from the 401(k) plan are reportable to the IRS but not taxable in the year of transfer. Note, qualified pre-tax plans, such as DROP, pre-tax SPSP/SPSP-H, pre-tax 401(a), and 457(b), may be eligible for rollover into the 401(k) plan after separation.

Future Considerations

No future contributions may be made after leaving City employment, with the exception of continuing loan payments. New loans are not allowed once you have left City employment. You may continue to make payments directly to Wells Fargo on an existing loan. There is no required mandatory distribution necessary until age 70 ½ years of age (or actual retirement age if still actively employed by the City). At this point, the IRS mandates the beginning of the Required Minimum Distribution (RMD).

For More Information

Please contact the Principal at 1-800-547-7754 to request a distribution, for more information regarding rollovers or for any questions regarding your account.

When You Can Access Your Funds

Once you are no longer a City employee (retirees hired as provisional are considered termed employees for distribution purposes), you may begin distributions, at will, at any age without penalty. This is due to the fact that plan participants must only be “separated from service” (retired or terminated) to begin distributions of their account. In other words, 457 plan distributions are “service-based” and not subject to age restrictions. Note, however, that due to the timing of your separation and when electronic files are sent to CalPERS/Voya, it may take between two to four weeks for CalPERS/Voya to have your separation documented in their system.

Distribution Options

You may leave your money in your CalPERS 457 Plan account for as long as you want, there is no minimum account balance. Distributions may be taken in any fashion a person chooses: full or partial lump sum, or systematic (monthly/quarterly/semi-annual/annual) withdrawals which may be changed, stopped and/or restarted until funds are depleted. Distributions from your CalPERS 457 Plan account are subject to mandatory 20% Federal and appropriate State withholding taxes, with documentation sent annually for tax return preparation. There is no early withdrawal penalty associated with the CalPERS 457 Plan, as long as you have separated from City service, you may withdraw funds at any age without an additional tax penalty.

Rollover Options

Assets in the plan may be rolled over to either another employer plan (if allowed by the new plan) or an Individual Retirement Account (IRA) after separation. Pre-tax funds may be rolled over to the City of San Diego 401(k) Plan. When received by the new plan, the funds assume the new plan's rules (for example, early withdrawal penalties apply if funds are withdrawn from an IRA before age 59½). Transfers from the 457 plan are reportable to the IRS but not taxable in the year of transfer.

Future Considerations

No future contributions may be made after leaving City employment. There is no Required Minimum Distribution (RMD) necessary until age 70½ years of age. The IRS mandates the beginning of the Required Minimum Distribution.

For More Information

Please contact the CalPERS Information Line at 1-800-260-0659 (press 2 for a Participant Service Representative) to request a distribution, for more information regarding rollovers or for any questions regarding your account.