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Retirement Corner

Hardships and Unforeseeable Emergencies

The University of Texas System is pleased to provide two voluntary retirement savings plans to employees to help make the most of the retirement years.  The purpose of the UTSaver Deferred Compensation Plan and the UTSaver Tax Sheltered Annuity plans is to provide long-term retirement savings opportunities. 

The retirement plans were developed within the regulations offered by the Internal Revenue Service, and one of the optional features to include in the plan design is loans, hardships, and distributions for unforeseen emergencies.  UT System chose to allow employees to take loans, hardships, and distributions for unforeseen emergencies which means that administrative procedures had to be developed to use in conjunction with the federal regulations.  The following article describes the differences between a loan and the distributions. 

Loans, hardships, and distributions are only available to active employees and from UTSaver voluntary retirement account balances with the six currently authorized UTRetirement Program Providers.  As a provision of state law, loans and hardships are not available with the Optional Retirement Program. 

Loans are available under both UTSaver voluntary retirement plans.  When a loan is granted, the amount must be paid back with interest to the employees retirement account.  If the loan is not re-paid within the established timeframe, the loan defaults which will prevent any future loans from either UTSaver voluntary retirement plans. 

For the UTSaver TSA Hardship Withdrawal, the need must be for the following reasons:

In addition to a legitimate reason, employees must also prove that the need cannot be resolved by one of the following:

If an employee is eligible to take a loan from the UTSaver TSA or UTSaver DCP, the employee will be required to take that loan before being allowed to take a hardship. Additionally, TSA Hardships are not available to ORP participants because a hardship distribution requires that all future 403(b) contributions be suspended for six months.  ORP and TSA are both 403(b) plans, but the ORP is a mandatory retirement contribution and contributions cannot be suspended. 

UTSaver DCP Unforeseen Emergency distributions are somewhat different than TSA Hardship Withdrawal requests.  DCP unforeseeable emergencies must be for one of the following reasons:

Like the UTSaver TSA plan, any requests for an unforeseeable withdrawal must be accompanied by documentation proving that the hardship cannot be relieved by any of the following:

A TSA Hardship Withdrawal or a DCP Unforeseeable Emergency will stop contributions into the affected plan for a period of no less than six (6) months and will re-start automatically after that time. 

To begin the process of applying for a loan, hardship, or unforeseen emergency distribution, please contact your UTRetirement Program Provider or visit the UTRetirement Program website at 

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