Deferred Compensation (457)
The State of Illinois Employees' Deferred Compensation Plan is a supplemental tax-deferred retirement plan for state employees.
Benefits to Deferred Compensation
- Reduce your current taxable income
- Investment earnings grow free of taxes
- Convenient payroll deductions
- Wide variety of investment choices
- Participate when you can
What are the limits?
The 2023 457 annual deduction limit is $22,500 for employees under age 50 and $30,000 for employees age 50 and older.
The deferrals, together with any earnings, accumulate tax-deferred until the employee terminates service, dies, or incurs unforeseeable financial hardship. Once distributions begin, the distributed monies are fully taxable as ordinary income for federal tax purposes. The funds are never taxed by the State of Illinois.
For Participants
Participants should contact the Deferred Compensation Division of CMS for more information. The State of Illinois plan is administered by Empower.
Another supplemental deferred compensation option is through the State Universities Retirement System (SURS). For more information, check the SURS Deferred Compensation Plan page.
