Get answers to frequently asked questions
Connecticut’s new state-sponsored retirement savings program is open right now. It was created to help the 600,000 private-sector employees without access to employer-sponsored retirement plans. We understand you’ll have questions. Here are the answers to some frequently asked questions. If you have additional questions, we’re here to help.
- Account Access
- Contributions
- Eligibility
- Employer Registration
- Fees and Costs
- General
- Investments
- Linking Bank Accounts
- Saver's Credit
- Security
- Self-enrollment
- Tax Forms
- Withdrawals
- Why don’t MyCTSavings contributions show up on my W2?
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MyCTSavings acts as a payroll deduction IRA, not a retirement plan as defined for the W2, so you won’t see your contributions reflected on your W2. Your IRA trustee will file Form 5498 IRA Contributions Information with the IRS, and you will receive a copy no later than May 31. You do not need to file this form with your taxes, but you should keep it with your tax records as documentation of your contributions for a particular tax year.
- Is the contribution rate based on gross or net income?
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Your contribution rate is based on your gross income (total income before taxes and other regular deductions are taken).
- Is there a limit to how much I can contribute?
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Yes, contribution limits for IRAs are set by the federal government. For 2024, you can save up to $7,000 per year if you’re younger than 50 and $8,000 per year if you’re 50 or older, as long as you have earned at least that much. If you are contributing to a Roth IRA, you also need to meet certain income levels based on your modified adjusted gross income (MAGI). This contribution limit applies across all IRAs you may have (both Traditional IRAs and Roth IRAs with the State and elsewhere).
- Is there a maximum percentage of income that can be contributed?
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There is no upper limit on the percentage of income that can be contributed; however, IRAs have annual contribution limits. Roth IRA contributions may be further limited by your income if it is above certain limits. Your contributions are made post-tax, and your employer can’t deduct more than the amount of your available pay after the employer has made any other payroll deductions that have higher preference as required by law.
- Can the State use money from MyCTSavings to fund other programs?
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No. Your payroll contributions are deposited directly in your name into your account with MyCTSavings. Neither the State nor anyone else can access your account, and your account is not tied to any other retirement plans the State offers.
- Can I make a tax-free rollover from a 529 (college savings) account to a MyCTSavings account?
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Yes, beginning on January 1, 2024, you can make a tax-free rollover from a 529 college savings account to your MyCTSavings account (or to any qualified Roth IRA). The rollover must be to a Roth IRA account in the name of the 529 account beneficiary, not in the name of the account owner/participant. In addition, the 529 account must have been open for a minimum of 15 years prior to the rollover to qualify as tax-free. Rollover amounts are subject to the annual contribution limits applicable to Roth IRAs. Over a lifetime, you may rollover up to $35,000 per beneficiary tax-free.
Forms to initiate a 529-to-Roth IRA rollover can be found with your 529 college savings plan.