Your contributions

Pre-tax or Roth contributions
You can choose to make pre-tax contributions, Roth contributions, or a combination of both. IRS contribution limits are based on your total contribution. Withdrawals from pre-tax contributions will be taxed at your ordinary income tax rate. Withdrawals from Roth contributions aren’t taxed as long as they are taken after age 59½ and you have held the account for at least five years. Earlier withdrawals may be subject to income taxes and a 10% federal penalty tax.*

Defined Contribution Retirement Plan (DCRP)
The university automatically contributes an amount equal to 5% of your gross pay, regardless of whether you personally contribute. The university will contribute an amount equal to an additional 5% of your gross pay when you contribute 3% of your salary. If you contribute less than 3% to the plan (0%, 1%, or 2%), then the university will contribute less (5%, 6.67%, or 8.34%).

Voluntary Contribution Retirement Plan (VCRP)
You can contribute from 1% to 100% of your salary on a pre-tax basis. You decide how much you would like to contribute.

Please note: There is a limit of $200,000 for earnings recognized for Plan purposes. This limit is slightly below the limit set forth by Internal Revenue Code, Section 401(a)(17) (visit vanguard.com/contributionlimits for current IRS contribution limits). When your contributions reach the limit for a given plan year, Georgetown University will automatically suspend your contributions (and the corresponding university contributions) for the remainder of the plan year, and subsequently restart contributions when the next plan year begins.

Therefore, the maximum employee contribution to this plan is $6,000 per year (3% of $200,000). The maximum employer contribution to this plan is $20,000 for employees hired on or after January 1, 1996, and $24,000 for employees hired on or before December 31, 1995.

Catch-up contributions
If you are age 50 or older, or will reach age 50 by year’s end, and you contribute the maximum allowed, you may make catch-up contributions. Catch-up contributions allow you to save above the normal IRS annual limit on a pre-tax basis.

*Taxes: Taking money from your retirement account can affect how much you’ll have to pay in taxes. You’ll owe taxes on pre-tax money. You won’t owe taxes on Roth earnings as long as you are age 59½ or older and it’s been at least five years since your first Roth contribution. If required by law, Vanguard will withhold some taxes for you. You may need to pay a 10% federal penalty tax if you take money out early.