The State of Indiana Hoosier START Plan 457(b) and 401(a) Deferred Compensation and Matching Incentive Plans sponsored by the Indiana State Comptroller helps employees prepare for and live in retirement. On average, state employees receive around 45% of their current income from their pension plan, and Social Security benefits vary. Most industry experts agree that all of us will need to supplement these benefits with savings or investments. In fact, experts also suggest we all may need between 75% and 90% of our current income just to maintain our current standard of living in retirement. If you think you might have a gap between what you have and what you need, participation in Hoosier START could help you resolve that gap.

Hoosier START offers both a 457(b) and a 401(a) Plan. The available plans include:

  • 457(b) Traditional Deferred Compensation Plan — tax-deferred (pre-tax), available to eligible State of Indiana employees and eligible public employees of local subdivisions or local units of government which have adopted the Plan.
  • 457(b) Roth Deferred Compensation Plan — after-tax, available to eligible State of Indiana employees and eligible public employees of local subdivisions or local units of government which have adopted the Plan.
  • 401(a) Matching Plan — tax-deferred (pre-tax), and available to eligible State of Indiana employees. Some participating local subdivisions also offer an employer match. Please check with your employer.

Frequently asked questions
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Pre-tax contributions reduce your current taxable income, meaning you owe no income tax on these contributions or their earnings until you withdraw the money. This allows your investments to grow tax-deferred, benefiting from compounding returns on money that would have otherwise been paid in taxes.

Roth contributions are made with after-tax dollars, so you don't get an immediate tax break. However, qualified withdrawals in retirement are tax-free, which can be advantageous if you expect to be in a higher tax bracket in the future.

You can contribute a maximum of 100% of includible compensation – not to exceed the tax code’s limit, a combination of before-tax and Roth contributions – of $23,000 in 2024. Eligible employees have a minimum contribution amount of 0.5% of includible compensation.

State employees receive a $15-per-paycheck matching contribution. Employees of counties, cities, towns or other political subdivisions may be eligible to receive a matching contribution. Please check with your plan sponsor.

If you will attain age 50 or older during the current calendar year, you may take advantage of the Age 50+ Catch-Up provision, which allows you to contribute more than the maximum limit. In 2024, this amount is $7,500 over the $23,000.

If you are within the three calendar years that end prior to the calendar year of your normal retirement age, you may be eligible to use the Special Catch-Up provision to contribute even more to your Hoosier START account. The Special Catch-up provision allows you to defer up to double the normal limit for up to three years.

The State of Indiana Hoosier START program is dedicated to transparency in fees and the cost of participation in the Plan. The Plan is funded almost entirely by participant paid fees.

Fees that participants pay currently come from three components:

  1. A record-keeping fee of $12 per quarter is assessed for the record-keeping and administration of each established account. This fee is reflected on your quarterly statement. Newly enrolled participants receive a 6-month administrative fee waiver from their first contribution date.
  2. An administrative expense fee of $1.50 per quarter is paid to Hoosier START for State administration of the plan. Newly enrolled participants receive a 6-month administrative expense fee waiver effective from their first contribution date.
  3. Investment management fees are the cost of each individual investment option that you select within your Plan account. This fee is not a visible deduction directly from a Plan investment but rather is charged by the investment managers against the performance of the investment product. These fees are expressed as a percentage known as expense ratios are disclosed on your quarterly statement. Note: funds may also impose redemption fees and/or restrictions on certain transfers, redemptions or exchanges if assets are held for less than the period stated in the fund’s prospectus and other disclosure document. For more information, refer to the fund’s prospectus and/or disclosure documents.

Distribution withholdings will vary depending on the type of distribution you request. Generally, the mandatory 20% federal income tax withholding will apply to distributions unless you elect a direct rollover of the entire amount or take periodic payments that last more than 10 years. Currently, Indiana does not mandate state income tax withholding at the time of distribution. The Plan will withhold state income taxes upon request. A Form 1099-R for the distribution amount will be mailed to you by January 31 of the year(s) following the year(s) in which you receive a distribution.

Your Roth distribution is income tax free if you withdraw your Roth contributions and any earnings after holding the account for at least five tax years and meet one of the following:

  • You are at least age 59½
  • You have a disability
  • Upon your death, after which your beneficiaries will take the withdrawal

If you or your beneficiary make a distribution without meeting the above qualifications, you will owe ordinary income tax on any earnings that are distributed.
View our State Leaders Guide for plan details and resources.