Employees nationwide have been appreciating the advantages of pre-tax retirement investment options.
A 401(k) plan is a retirement plan in which you make payroll contributions on a pre-tax basis to build retirement savings. The money you choose to put into this plan (up to a federally set maximum per year) will not be taxed when it is invested. You will save now as less Federal and State taxes will be withheld from your paycheck. Further, the contributions you put into the plan will be invested. Any interest, earnings or gains will not be taxed as long as your investment remains within a 401(k) plan.
When Your Contract Ends
Chancellor customized our 401(k) plan especially for contractors by providing options that make the management of your 401(k) plan hassle free when your contract/employment with Chancellor ends.
You have at least three (3) options:
1. Do nothing for now and your 401(k) monies remain invested until you decide to move them somewhere else or a contract through Chancellor starts again.
2. Rollover the monies into another 401(k) plan from your next employer.
3. Open a personal IRA rollover account and rollover your 401(k) monies.
Chancellor will send you an e-mail with this information and instructions you need as soon as your employment through Chancellor has ended.
This Special Tax Notice is referenced in the e-mail you will receive and provides additional information concerning your distribution.
If you choose option 1 then you do nothing.
If you choose option 2 then you cash out and roll over the money into the next employer’s 401(k) account.
If you decide on option 3 then we recommend that you establish an individual IRA Rollover account. Charles Schwab and Fidelity are popular choices.
Having an IRA Rollover account means that you can self-manage the account and invest in funds and individual stocks of your own choice. Over the course of your career, you can continue to roll 401(k) monies/shares into this IRA from different companies that you work for.
If you decide on option 2 or 3 then Send an e-mail to anthony(at)chancellor(dot)com to request a distribution form.
For those who were current employees in the current calendar year, 401(k) monies/shares are distributed twice yearly and a distribution form needs to be received in our office by December 31st or by June 30th. The distribution will occur at the end of the next quarter. Please allow 2-3 weeks for processing the payment.
For those former employees who chose to leave their 401(k) monies invested in the Chancellor 401(k) Plan, distributions occur once per year and a distribution form needs to be received in our office by December 31st. The distribution will occur sometime in the 2nd quarter. Please allow 2-3 weeks for processing.
There is no loss to you because your money remains in our 401(k) plan until the actual distribution.