The Alternate Benefit Program (ABP)
is a tax-sheltered, defined contribution retirement program for higher
education faculty and certain administrators. The ABP provides retirement benefits,
life insurance, and disability coverage, which, when combined with Social Security
and other tax-deferred plans, can provide security in retirement.
Full-time
faculty, officers, visiting professors and certain professional administrative
staff required to possess a college degree or its equivalent participate in the
ABP. “Full-time” has been defined to include anyone receiving 50% or
more of base salary and may include anyone on sabbatical or paid leave of absence
for a period not to exceed one year. Individuals not eligible for membership include:
part-time or adjunct faculty; temporary employees (with the exception of visiting
professors appointed for a school year, a semester, or a lesser period of time);
faculty members temporarily in the US under an F or J visa; employees in a career
service title as defined by the NJ State Department of Personnel; employees in
clerical and other nonprofessional positions; and any employee receiving a retirement
benefit from any NJ State retirement system including ABP.
Members
annually contribute 5% of base or contractual salary matched by an 8% employer
contribution to a tax-deferred investment account. This account may be established
with any of the carriers that are currently authorized. Additional voluntary federal
tax-deferred contributions under Internal Revenue Code, Section 403(b), may also
be made, based on the actual base salary paid less the mandatory 5% member contribution.
Before having any additional contributions deducted, members should contact the
authorized carrier of their ABP account for a calculation on the exact amount
available to them for a Section 403(b) contribution. These contributions cannot
exceed the actual dollar limits eligible for tax-shelter in a given tax year.