SUPPLEMENT DATED MARCH 20, 2006 TO THE
VARIABLE CONTRACT PROSPECTUSES LISTED BELOW
The following information supplements, and to the extent inconsistent therewith,
replaces the information in the prospectus and statement of additional
information. Please retain this supplement for future reference.
DESIGNATED ROTH ACCOUNTS FOR 403(B) PLANS AND 401(K) PLANS
Effective January 1, 2006, employers that have established and maintain
TSA or 401(k) plans ("collectively the Plan") may also establish a
Qualified Roth Contribution Program under Section 402A of the Code
("Designated Roth Accounts") to accept after tax contributions as part
of the TSA or 401(k) plan. In accordance with our administrative
procedures, we may permit these contributions to be made as purchase
payments to a Section 403(b) Contract or to a Contract issued under a
401(k) program under the following conditions:
1. The employer maintaining the plan has demonstrated to our
satisfaction that Designated Roth Accounts are permitted under the
Plan.
2. In accordance with our administrative procedures, the amount of
elective deferrals has been irrevocably designated as an after-tax
contribution to the Designated Roth Account.
3. All state regulatory approvals have been obtained to permit the
Contract to accept such after-tax elective deferral contributions
(and, where permitted under the Qualified Roth Contribution
Program and the Contract, rollovers and trustee-to trustee
transfers from other Designated Roth Accounts).
4. In accordance with our procedures and in a form satisfactory to
us, we may accept rollovers from other funding vehicles under any
Qualified Roth Contribution Program of the same type in which the
employee participates as well as trustee-to-trustee transfers from
other funding vehicles under the same Qualified Roth Contribution
Program for which the participant is making elective deferral
contributions to the Contract.
5. No other contribution types (including employer contributions,
matching contributions, etc.) will be allowed as designated Roth
contributions, unless they become permitted under the Code.
6. If permitted under the federal tax law, we may permit both pre-tax
contributions under a Plan as well as after-tax contributions
under that Plan's Qualified Roth Contribution Program to be made
under the same Contract as well as rollover contributions and
contributions by trustee-to-trustee transfers. In such cases, we
will account separately for the designated Roth contributions and
the earnings thereon from the contributions and earnings made
under the pre-tax TSA plan or pre-tax 401(k) plan (whether made as
elective deferrals, rollover contributions or trustee-to-trustee
transfers). As between the pre-tax or traditional Plan and the
Qualified Roth Contribution Program, we will allocate any living
benefits or death benefits provided under the Contract on a
reasonable basis, as permitted under the tax law. However, we
reserve the right to require a separate TSA Contract to accept
designated Roth TSA contributions and a separate section 401(k)
Contract to accept designated Roth 401(k) contributions.
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7. We may refuse to accept contributions made as rollovers and
trustee-to-trustee transfers, unless we are furnished with a
breakdown as between participant contributions and earnings at the
time of the contribution.
Many of the federal income tax rules pertaining to Designated Roth
Accounts have not yet been finalized. Both you and your employer should
consult their own tax and legal advisors prior to making or permitting
contributions to be made to a Qualified Roth Contribution Program.
The following general tax rules are based on our understanding of the
Code and any regulations issued through December 31,2005, and are
subject to change and to different interpretation as well as additional
guidance in respect to areas not previously addressed:
o The employer must permit contributions under a pre-tax 403(b)
or pre-tax 401 (k) plan in order to permit contributions to
be irrevocably designated and made part of the Qualified Roth
Contribution Program.
o Elective deferral contributions to the Designated Roth
Account must be aggregated with all other elective deferral
contributions made by a taxpayer for purposes of the
individual Code Section 402(g) limits and the Code Section
414(v) limits (age 50+catch-up) as well as contribution
limits that apply under the Plan.
o In general, the same tax law rules with respect to restricted
monies, triggering events and permitted distributions will
apply to the Designated Roth Accounts under the Plan as apply
to the traditional pre-tax accounts under the Plan (e.g.,
death or disability of participant, severance from
employment, attainment of age 59 1/2, hardship withdrawals
only with respect to contributions, if permitted under the
Plan).
o If the amounts have been held under any Designated Roth
Account of a participant for at least five years, and are
made on account of death, disability, or after attainment of
age 59 1/2, then any withdrawal, distribution or payment of
these amounts is generally free of federal income tax
("Qualified Distribution").
o Unlike Roth IRAs, withdrawal, distributions and payments that
do not meet the five year rule will generally be taxed on a
pro-rated basis with respect to earnings and after-tax
contributions. The 10% penalty tax will generally apply on
the same basis as a traditional pre-tax account under the
Plan. Additionally, rollover distributions may only be made
tax-free into another Designated Roth Account or into a Roth
IRA.
o Some states may not permit contributions to be made to a
Qualified Roth Contribution Program or may require additional
conforming legislation for these rules to become effective.
SUPPLEMENT TO THE FOLLOWING VARIABLE CONTRACT PROSPECTUSES DATED MAY 2, 2005:
GOLD TRACK ANNUITY
GOLD TRACK SELECT ANNUITY
TRAVELERS RETIREMENT PERSPECTIVES
THE TRAVELERS INSURANCE COMPANY FIXED ANNUITY
UNIVERSAL ANNUITY
UNIVERSAL ANNUITY ADVANTAGE
UNIVERSAL SELECT ANNUITY
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