Vacation Lump-Sum Tax Deferral Information

An employee receiving a lump-sum vacation payout may elect to defer a portion of the payment into a qualified tax-sheltered plan offered by The Texas A&M University System to avoid some of the tax implications. The account must be established and the proper paperwork received prior to the lump-sum payment request being submitted to Payroll Services for processing.

Vacation Deferral Instructions:

Tax Deferred Account Program (TDA)

1. Establish a TDA account with your selected vendor if you do not already have a TDA account established (the TDA account is a separate account from your ORP account)
2. Complete the TDA Salary Reduction Agreement/Change of Vendor within Workday
3. Indicate on the completed form your desire to defer compensation: Upon termination or retirement, defer $_____ or _____% of my lump-sum vacation pay for deposit in a Tax-Deferred Account
4. Return the completed, signed form to your department HR Professional  along with the supporting documentation that the new account has been established (supporting account paperwork is not necessary with an existing TDA account) This paperwork should be included and submitted with the lump-sum payment request sent to Payroll Services (MS 1261) for processing.

Texa$aver Deferred Compensation Plan (DCP)

1. Establish a DCP account with Texa$aver at Texasaver.com or by contacting Texa$aver directly at (800) 634-5091
2. Work with your HR Professional to document the request for lump sum payment deferral

Important Information and Resources

• Selecting an ORP/TDA Vendor
• TDA and DCP Programs
• Maximum Contribution Limits for TDA and DCP

Approved Vendor Contact Information

A listing of the approved vendors and their contact information is available.

Contact Information

General information about TDA/DCP programs:  benefits@tamu.edu or 979-862-1718

All other questions regarding lump-sum deferral: Contact your HR professional