To:    Employees Eligible for the LIRRD UTU (SMART-TD) Retroactive Wage Adjustment

From:    Tax Favored Programs

Re:    Retro Pay 401(k)/457 Plan Deferrals: SUBMIT ELECTION ONLINE BY 03/27/2024

The MTA Tax Favored Programs Unit has been advised that you may be eligible to receive a Retroactive Wage Adjustment (RWA) which is scheduled to be paid in May. This payment will be issued in a separate payment from your regular paycheck.

If you do not make a special election, your normal 401(k)/457 deferral elections will apply. If you want no deferrals withheld from this check or wish to defer an amount other than your normal election, you will have to make a special election on My MTA Portal at www.mymta.info by following these steps:

All deferral elections must be submitted online by Wednesday, March 27, 2024. No late elections will be accepted, and no checks will be reissued. If you want to change your election before the deadline, you may enter another election and the latest election will be used for the Retro Active payment. For assistance with portal sign-on please contact the BSC at 646-376-0123.

Traditional 401(k) and 457 Plan contributions are exempt from federal and state taxes; Roth contributions are made on an after-tax basis; therefore, they are NOT exempt from federal and state taxes. Whether you elect to make traditional, pre-tax deferrals or Roth, after-tax deferrals, the gross amount of your payment is always subject to FICA (Social Security and Medicare required withholding, or the equivalent under the RRB). Since the amounts withheld for FICA (or the equivalent) cannot be deferred into the plan, they are considered income/wages and are therefore (federally and state) taxable. As a result, even if you elect to defer 100% of your payment, the final percentage deferred will be less than 100% because of the required withholdings. You should always consult a tax advisor for advice on your personal tax situation.

All amounts deferred (pre-tax and Roth) will be limited by the IRS annual contribution limit, which is inclusive of any contributions already made through payroll deductions during the same calendar year. The 2024 contribution limit in each Plan is $23,000 if you are under age 50, or $30,500 if you are age 50 or older at any time during the calendar year. If you are a 457 Plan participant using the special 3-Year Catch-Up Provision, your maximum 457 contribution may be as high as $46,000.

If you have never participated in the Deferred Compensation program, now may be a good time to enroll. Please log onto the Prudential/Empower website www.prudential.com/mta, or call Empower at 1-877-PLN-4MTA (1-877-756-4682) Monday through Friday, from 8 a.m. to 9 p.m. to enroll. Empower representatives are also available for personal, virtual meetings.  To schedule a one-on-one meeting with a representative, go to the Prudential/Empower website and click on the “Meet Your Plan Representative” link to make an appointment.