MBA 403(b)

Roth 403(b)

  • Available to MBA retirement participants
  • Tax-free distributions at retirement
  • Earnings grow tax-free
  • 2010 allows up to $16,500 in contributions or $22,000 if you're age 50 or over

View Roth 403(b) FAQs »

In-plan 403(b) Roth Conversions

You may now be able to convert your pre-tax and traditional after-tax 403(b) balances to a Roth 403(b) after-tax account within the MBA plan.

Download the MBA Roth 403(b) Roth Conversion Form »

Conditions for Eligibility to Convert

  1. Your ministry employer’s 403(b) written plan must allow for Roth contributions.
    • If your plan does not currently offer Roth contributions, it can be easily amended. View a plan amendment template »
    • Participation in the Roth 403(b) by evangelists and chaplains is allowed by MBA’s plan document.
    • Retired ministers and non-credentialed former employees may also convert balances to a Roth account with proper certification.
  2. Only the original member or spouse beneficiary may convert funds.
  3. You may only convert certain balances to a Roth balance. (See the chart below.)
  4. Only balances that are eligible rollover amounts may be converted (you may not convert required minimum distributions and certain other amounts).
Type of Contribution Description Roth Conversion Eligible
Employee Elective Deferrals Monies deferred from employee's pay Death, disability, age 59 ½, termination of AG credentials, and termination of employment
Employer-paid Monies contributed by employer (match, discretionary that was not otherwise negotiated by employee) Age 25 and older,
100% vested balance
Rollover Monies rolled into MBA from another plan Anytime
Traditional After-tax Employee-made contributions that have been taxed prior to contribution Anytime

If you no longer work for an eligible employer, you may be required to close out your account if the total balance is under $1,000.

Things to Consider before Converting

  1. Irrevocable – once conversion is complete, it cannot be changed.
  2. Amount converted is subject to income tax. If conversion is completed in 2010, inclusion in income for federal tax purposes can be deferred over the 2011 and 2012 tax years. Subsequent conversion tax liability will be due in conversion year.
  3. Tax liability must be funded from assets outside the plan.
  4. If you are a credentialed minister with the Assemblies of God, your pre-tax 403(b) balances may be eligible for retired housing distributions. The amount converted is not eligible for clergy housing.
  5. Roth 403(b) and Roth IRA distribution rules are different.
  6. Roth 403(b) funds are subject to required minimum distributions.
  7. Qualified distributions from a Roth 403(b) are totally tax free. Subsequent to conversion, early distributions may result in the inclusion of earnings in taxable income. An early distribution tax penalty may also apply.

Remember to consult your own tax advisor regarding your specific tax situation. If you have questions, please call 1.800.622.7526 or email .

Many Roth 403(b) rules differ from Roth IRA rules. Roth 403(b) contributions are taxed before going into the plan. Roth 403(b) contributions are made through salary deferral. Distributions are not allowed except after five years from the date of the first contribution and can only be made after age 59 1/2, at disability, or at death. Distributions for severance from employment are allowed but may be subject to taxes and IRS imposed penalties. Maximum Roth 403(b) contributions are limited by amounts specified by law.