TIAA-CREF After Tax Annuity - How to begin withdrawals?

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Retired1809
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TIAA-CREF After Tax Annuity - How to begin withdrawals?

Post by Retired1809 »

[Moved into a new thread from: TIAA-CREF After Tax Annuity - How to begin withdrawals? --admin LadyGeek]

I understand that we are encouraged to search for answers to our questions in old Boglehead posts before creating a new discussion so I'm adding to an existing discussion created several years ago.

Here's my question: If a TIAA RA participant has a TIAA After-Tax Annuity and had made investments of $50,000 into the TIAA Guaranteed Traditional account in each of four years and now wants to begin withdrawing, can he or she begin the 9 year and a day withdrawal from just one of the $50,000 traunches or must it be an "all-or-nothing" distribution? And does the interest rate change once the distributions process begins?

And can anyone give me a link to the answers to my questions at the TIAA Web site? Thanks.
Katietsu
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Re: TIAA-CREF After Tax Annuity

Post by Katietsu »

Given all the quirks and variations with TIAA products, I would really try to go through customer service.

I am editing my answer because when I searched for a link to provide, I think I learned that the After Tax Annuities have their own unique withdrawal rules.
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Re: TIAA-CREF After Tax Annuity

Post by crefwatch »

Retired1809, I would have started a new thread, since your question is not about an ATRA.

The answer to your question is, no. In one account, you do not get to select what part of a TIAA Traditional allocation is withdrawn. All withdrawals are taken, proportionally, from all Vintages, which are periodically determined by TIAA. There is no such thing as deposit tranches.
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Re: TIAA-CREF After Tax Annuity - How to begin withdrawals?

Post by CULater »

With my ATRA, you cannot make partial withdrawals from Traditional. It is all or nothing. This applies to a TPA or to a lifetime annuity.
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Re: TIAA-CREF After Tax Annuity - How to begin withdrawals?

Post by crefwatch »

Unfortunately, the long discussion of ATRAs over at Morningstar is among the many deleted, in the recent purge by Morningstar. That was important, because the (original, simplest version, ATRA as the analog of RA, SRA, GSRA, RC, RCP ... ) product was originally created to segregate funds that had been contributed before the IRS required keeping only pre-tax funds in the basic RA product.

In my case, without telling me, TIAA somehow (or, purportedly) tracked all of the "optional contributions", which once was a Defined Term, I had made in the 1980s when I had no retirement plan at work. These post-tax monies, along with their earnings, were removed from my RA (which has had/has no contributions since 1979) and used to create my ATRA. When I complained, they assured me that all of my Vintages in TIAA Traditional had been preserved.
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Re: TIAA-CREF After Tax Annuity

Post by livesoft »

Katietsu wrote: Fri Jun 12, 2020 1:10 am Given all the quirks and variations with TIAA products, I would really try to go through customer service.
This is a great answer that I completely agree with.

I have ALWAYS called them whenever I have had any questions. I wouldn't trust any answers provided by random knowledgeable internet posters.
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Re: TIAA-CREF After Tax Annuity - How to begin withdrawals?

Post by CULater »

crefwatch wrote: Fri Jun 12, 2020 8:08 am Unfortunately, the long discussion of ATRAs over at Morningstar is among the many deleted, in the recent purge by Morningstar. That was important, because the (original, simplest version, ATRA as the analog of RA, SRA, GSRA, RC, RCP ... ) product was originally created to segregate funds that had been contributed before the IRS required keeping only pre-tax funds in the basic RA product.

In my case, without telling me, TIAA somehow (or, purportedly) tracked all of the "optional contributions", which once was a Defined Term, I had made in the 1980s when I had no retirement plan at work. These post-tax monies, along with their earnings, were removed from my RA (which has had/has no contributions since 1979) and used to create my ATRA. When I complained, they assured me that all of my Vintages in TIAA Traditional had been preserved.
Yes, my ATRA was created for the same reason. Originally, all my contributions were co-mingled with pre-tax and after-tax in the same contract. My after-tax contributions source were designated as "Self-Remitters". These contributions were made in the 1990s. When these were split out into a separate ATRA it got messy and TIAA didn't tally things correctly and undercounted my after-tax contributions. Fortunately, I had requested a summary report of all my contributions many years ago which does document this amounts. TIAA tells me they have made the correction in their system but I'm still waiting for written confirmation.

BTW, I've had more success communicating with TIAA by way of Messaging on the website. I made a couple of phone calls to deal with this issue and got the wrong answer both times. It seemed easier to get the matter kicked up to progressively higher levels within TIAA to resolve the matter when I used Messaging. When you call these days, the call is handled by some random person around the country probably working from their home location and I don't think they have access to all the information that might be necessary. So, whatever answer you get I'd get it verified by submitting the issue via Messaging.
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Re: TIAA-CREF After Tax Annuity - How to begin withdrawals?

Post by crefwatch »

Below is part of a personal answer from TIAA that I received in 2004:

While your TIAA-CREF Retirement Annuity (RA) contracts provide you the right to contribute additional after-tax premiums (He means to the original RA, which was part of my question), these funds do not become part of the plan accumulations under your contracts, and must be treated differently for income tax and reporting purposes. The existence of contracts with both plan and non-plan accumulations made them extremely difficult to administer, and it was decided that the easiest way to maintain the terms of the contracts and properly administer their funds would be to issue contracts to hold the self-remitted funds which contained, to the extent legally possible, the same rights, terms and provisions as found in the original contracts.

As discussed above, there is no specific federal regulation which required the establishment ofthese AFTRA contracts, but the fact remains that the plan accumulations in your RA contracts have to be administered according to the Internal Revenue Code (Code) section(s) under which the planes) was/were established; 403(b), 401 (a), 457, etc., while the non-plan accumulation have to be treated under several other Code sections, most notably Code Section 72 and its attendant regulations.

The decision has been made that in order to properly serve our participants and sponsoring institutions, all self-remitted funds are to be placed in ATRA contracts. These will, as I have previously discussed, contain the same terms and provisions as your RA contracts and provide you the same rights. To the extent the ATRA contracts cannot do this, (e.g., the Inflation Linked Bond Account is not available under the ATRA contracts,) their provisions will be different. However, as long as you have self-remitted funds in your TIAA-CREF RA contracts, such funds will be placed in the ATRA contracts, and administered according to the rules applicable to such funds. Leaving these funds in your RA contracts would not have exempted such funds from proper treatment, only made it more difficult to administer them correctly.

Note that Federal tax law may have changed since 2004. I have a vague memory that when I made a reallocation between TIAA Traditional and CREF in this ATRA account, I may have had to fill out a special, annoying form for a "1035 Exchange". Movement between TIAA Trad and TIAA Real Estate did not require a 1035, and movement between two CREF accounts did not require a 1035 exchange. This only applied to ATRA funds moving between the two, legally separate companies, TIAA and CREF. I have no recent data on this issue.
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