The Tax Sheltered Annuity (TSA) Program is a voluntary program that allows eligible CSU employees to save toward retirement by investing pre-tax contributions in tax-deferred investments. TSA contributions are made solely by the employee through payroll deductions, prior to federal and state taxes being calculated.

The Internal Revenue Code (IRC) establishes specific limits that govern the amounts an individual can contribute to a 403(b) plan. As a result of the federally mandated Economic Growth Tax and Reconciliation Relief Act (EGTRRA), effective January 1, 2002, contribution limits and provisions for 403(b) plans were significantly revised. Currently, two IRC limits apply: the IRC Section 402(g) "elective deferral limit" and the IRC Section 415(c) "percentage of compensation" limit. For the 2008 tax year, the contribution limit is 100% of adjusted gross income (up to $46,000), or a maximum of $15,500 per year.

Additionally, contributions to a 403(b) plan are not offset by contributions to a 457 plan. For example, for tax year 2007, a participant could elect to contribute up to $15,500 to a 403(b) plan AND up to $15,500 to a 457 plan, for a total contribution of up to $31,000.

In order for eligible employees to take advantage of the tax savings via payroll deduction, a 403(b) account must be established with one of the TSA companies on CSU's authorized list.

For additional information regarding this program, including maximum contribution amounts, catch-up allowances, and administration of the TSA program, please refer to the Technical Letters.