First quarter interest rate is 2.25% on monies received by
March 23, 2020. That rate beats many CD rates being
offered and there are tax advantages to this program.
Please read below for the details.
The American Senior Benefits Association (ASBA) has contracted with Independent Plan
Coordinators, Inc. (IPC) to offer its members the
opportunity to voluntarily establish their own Individual
Retirement Account (IRA: Traditional or Roth) and/or
Non-Qualified Tax-Deferred Annuity Account. There is no mandatory minimum contribution amount and no
administration fees are assessed.
As an ASBA Supplemental Retirement Participant, you have the
option of contributing to either a fixed rate product where
the funds are placed with the Lincoln National Life
Insurance Company at the then quarterly prevailing interest
rate. Participants receive quarterly
statements and confirmations of all contributions.
Participants may choose IRA accounts
and/or Non-Qualified Tax-Deferred Annuities. For
IRAs, Traditional IRAs and Roth IRAs are available.
The maximum contribution amount for the 2020 tax year is
limited to 100% of earned income up to $12,000 for joint
filers (up to $6,000 each) and $6,000 for singles. These
limits are subject to change annually. Participants
age 50 or older during the tax year may contribute an
additional $1,000. This is a combined maximum for all
Traditional and Roth IRAs you hold.
- All or part of
your contributions may be deductible. The determining
factors for deductibility are the income restrictions and
eligibility to participate in an employer-sponsored
qualified retirement plan.
are non-deductible. Earnings, however, are tax-free
provided the account has been open at least five tax years
and you are at least 591/2
begin withdrawals. The availability of this type of IRA is
phased out according to your Adjusted Gross Income: for
joint filers, $196,000 to
$206,000; for single filers, $124,000 to $139,000 for 2020.
IRA contributions can be made for tax year
2019 until April 15, 2020 or until your 2019 tax return is
filed (excluding filing extensions). If any portion of your
Traditional IRA contribution is non-deductible, you must
file Form 8606 with your tax return. IPC can provide more
details on deductibility upon request.
Under the ASBA Supplemental Retirement Plan, you
may roll over your accumulated balance in a qualified
retirement plan into a Traditional IRA without tax
consequences. You may also transfer or roll over a
Traditional IRA into another Traditional IRA, or a Roth IRA.
You may transfer a Roth IRA to another Roth IRA. You
should be certain that you understand the tax consequences
before executing any transfer.
Minimum required distributions (MRDs) for Traditional IRAs must begin
at age 70 1/2 if you reached that age by December 31, 2019,
or age 72 if you reach that age after January 1, 2021.
MRDs must begin by April 1 of the
year following the year in which you attain MRD age.
If you wait until that year, your second MRD is due by
December 31. For Roth IRAs there is no age requirement for
NON-QUALIFIED TAX-DEFERRED ANNUITY -
If you wish to
make contributions greater than those permitted under IRA
regulations, or if you are not eligible to establish a
deductible IRA, you may want to participate in the
Non-Qualified Deferred Annuity portion of the ASBA Supplemental
Retirement Plan and have all of the advantages of this
tax-deferred annuity plan for your retirement planning.
There are no limitations on contributions. You may
contribute as much as you wish at any time.
Contributions are not tax deductible. However, interest
earnings will accumulate on a tax-deferred basis, that is,
no taxes will be assessed until earnings are withdrawn.
Withdrawals are processed from interest (IRS
Regulations). IRS reporting requirements do not oblige
you to indicate contributions to or current interest
earnings on a Non-Qualified Deferred Annuity on your Form
1040 (done at time of withdrawal). There are no
maximum age limitations for contributions or withdrawals.
Your contributions to a fixed rate product will be placed
Lincoln National Life Insurance Company, a company with a
strong history of outstanding investment
performance and is a leader in the industry with over 100 years of experience,
assuring us of both expertise and unquestioned reliability. Lincoln
National Life Insurance Company's financial strength is rated "A+" by A.M. Best
and gives Lincoln National Life Insurance Company a ranking of "Superior". These
ratings reflect claims paying ability but are not a guarantee of future
performance. The Lincoln Financial Group had $261 billion in assets under
management as of September 30, 2019.
(A.M. Best is a global full-service credit rating agency
dedicated to serving the financial and health-care service
industries. It began assigning credit ratings in 1906.
A.M. Best's ratings are independent opinions regarding the
creditworthiness of an issuer or debt obligation.
Their Credit Ratings are based on a comprehensive
quantitative and qualitative evaluation of a company's
balance sheet strength, operating performance and business
profile, or, where appropriate, the specific nature and
details of a debt security.)
The first quarter interest rate is 2.25% on all contributions
received by March 23, 2020. First quarter
2020 contributions will receive this interest rate upon receipt
of your contribution by Lincoln National Life through
December 31, 2020. For 2020 contributions received
after March 23, 2020, an interest rate will be declared each quarter and
contributions received and credited during a particular
quarter will receive that interest rate until December 31,
principal and earned interest are guaranteed by Lincoln
National Life Insurance Company and is based on continued
claims paying ability of Lincoln National Life Insurance
Withdrawals are processed as of the 15
calendar day of the month,
received 5 business days prior to the withdrawal date.
You may request withdrawal forms from IPC via calling (800)
368-3515, or you can download them from our website.
Generally, distributions received prior to
age 59 1/2
that are not due to death, disability, transfer or rollover
are subject to a 10% IRS Penalty Tax as follows: (1)
Traditional IRA - on the full amount withdrawn; (2)
Non-Qualified Deferred Annuity - on interest earnings only;
(3) Roth IRA – some withdrawals may be penalty-free and some
may even be tax-free. However, the combination of several
factors, including your age and whether the account has been
open at least five tax years will affect the taxability.
Consult your tax advisor for more details.
There is a 5% surrender charge associated with withdrawals (including
transfers and rollovers) if you have been a Plan Participant
for less than 5 years under the Lincoln National Life
contract. The surrender charge drops to 4% in year 6;
3% in year 7; 2% in year 8; and 1% in year 9. This
surrender charge will not be assessed at all if the
Participant is (1) 59
retired or (2)
disabled or (3) deceased. Please note that the
surrender charge is completely eliminated after year 10.
Please also note that your first contribution to the ASBA Supplemental Retirement Plan is
what is used to determine the surrender change.
You may withdraw up to 50% of your
accumulated interest earnings once per year without
surrender charge. Each lump sum contribution of $10,000 or
more per participant that you make in 2020 will be credited
with an additional .10% for 2020. These features are subject
to change at any time.
Independent Plan Coordinators, Inc. (IPC) has partnered with SAGE Scholars to
offer a college savings program to its Supplemental Retirement Plan (SRP)
Tuition Rewards. SRP Participants will now have the opportunity to
earn Tuition Reward points, similar to other popular rewards programs, which can
be redeemed as tuition discounts at hundreds of
participating private four-year colleges and universities.
There is no limit as to how many student family members an SRP participant may
sponsor. For example, a grandparent can sponsor all of his/her
grandchildren, grandnieces and grandnephews.
SRP Participants who enroll
will earn Tuition Reward points equaling 1.25% of the
combined asset balances in their IRA and/or Non-Qualified
Tax-Deferred Annuity accounts on a quarterly basis. Every
Tuition Reward point can be redeemed for $1.00 in tuition
reduction at participating colleges. These guaranteed
minimum scholarships are capped at one full year of tuition,
spread evenly over four years. Room and board is not
included; a college's normal admissions standards apply.
The program is limited to
participating four-year private
colleges and universities.
Your available retirement options include Lump Sum
Distribution, Quarterly, Semi-Annual or Annual payout
directly from your balance. You may also purchase an
annuity guaranteeing you an income from Lincoln National
Life Insurance Company. IPC will work with you to
select the option that best suits your needs and takes care
of all the administrative activities associated with that
The turbulent financial market has
reinforced the need for a stable funding option to meet your
retirement planning needs. The ASBA
Supplemental Retirement Plan offers this
option to you. In addition, you'll receive outstanding
customer service from the staff of IPC who are located in
Virginia Beach, VA. Call us at (800) 368-3515 if you
would like to discuss the ASBA Supplemental
Retirement Plan in more detail.
If you would like to take advantage of the
many benefits of the ASBA Supplemental Retirement Plan, please
the Enrollment Form and then send it along with your
contribution to IPC at the following address: