Professional Documents
Culture Documents
Features
1. Eligible
Employers
Code 403(b)
Code 401(k)
Generally, corporations,
partnerships, sole
proprietors, taxexempt employers,
private schools,
colleges, and
Code 501(c)(3) entity
The employer must be organized and universities, and
operated exclusively for at least one church organizations.
of the following purposes:
No governmental
Religious
employers (unless
established on or
Charitable
before May 6, 1986).
Scientific
Animal or Child
Abuse Prevention
Literary
Education
Promotion of
Amateur Sports (not the
sports facility)
Cooperative Hospital
Services Organization
These 501(e)
organizations perform
certain functions on behalf of
501(c)(3) organizations
Foundations
Non-profit
foundations under509(a)
and private
foundations under 4942(j)
(3) are eligible. They
must satisfy 501(c)
(3) before they can satisfy
509(a)or 4942(j)(3).
Uniformed Services
2. Eligibility to
Defer
Exclusions from
participation
Eligibility:
Immediate
Eligibility:
maximum of 1 year
of service and age
21
NRA with no US
income
NRA with no
US Income
If Eligible to
participate in:
another 403(b),
a 401(k), or
a Gov't. 457(b)
Work Less
than 20 hrs.
Collectively
bargained
Classification
exclusions, provided
410(b) coverage is
passed.
availability rules.
3. Eligibility to
participate
a. Match
b. Discretionary
4. ERISA
Coverage
a. Employer can
a. Employer can define conditions. define conditions.
Maximum is generally age 21/1 year Maximum is generally
of service.
age 21/1 year of
service.
Governmental and
Church plans are
exempt from being
ERISA plans.
6. Vesting
ERISA 403(b) subject to ERISA
vesting requirements.
As determined by
employer under 411.
Non-ERISA Plan: No
8. Funding
Vehicles
a.
a. Annuity
Yes
a.
Yes
Contracts
b. Custodial
Accounts (Mutual
Funds)
c. Other Broad
Investment
Options
b.
Yes
b.
Yes
c. Yes, as governed
by the plan document
9. Participant
Directed
Investments
a. ER selects
options
a.
Yes
b.
Yes
a.
$17,500 in 2013.
b. ERISA 404(c)
a.
Yes
b.
Yes
a.
$17,500 in 2013.
10. Limitations on
Contributions
a. Code 402(g)
b. Certain participants with 15
b. Code 402(g)(7) years service may increase limit up
Special Catch- to $3,000 per year to maximum
lifetime of $15,000.
up
c. Code 414(u)
Catch-up
d. Code 415
Annual Additions
11. Code 415
Aggregation
c.
b.
c.
Not available
Code 401(k)
contributions are
always aggregated with
contributions to a
qualified plan for
purposes of the Code
415 limit.
N/A
25% of compensation
in 2013.
N/A to tax-exempt
sponsors.
13.
Antidiscrimination
a. Deferrals
a.
No testing
b.
b. Matching
c. Discretionary
ER
Note: No testing
for governmental
organization
14. PreRetirement
Distributions
a. Hardships
b. Loans
c. In-Service
Withdrawals
before age 59
a.
Yes
b.
Yes
a.
Yes
b.
Yes
15. Distributable
Events
a. Death
a.
b.
Yes
c.
Yes
d.
Yes
Yes
c. Age 59
c.
Yes
d. Severance from
Employment
d.
Yes
e. Termination of
Plan
Yes
Yes
b. Disability
b.
a.
e. Yes
a. Lump sum,
installments and
16. Distributions
a. Forms
b. Required
Beginning Date
c. Aggregation of
RMD
annuities.
b. Generally, the later of age 70
b. Generally, the later
or the non-5% owner's actual date of
of age 70 or the nonretirement. 5% owners by April 1
5% owner's actual date
after the year age 70 is reached.
of retirement. 5%
owners by April 1 after
However, for Pre-1987 accruals the
the year age 70 is
required beginning date is the later
reached.
of age 75 or the participant's actual
date of retirement. Governmental
employees may use the later of age
75 or the participant's actual date of
retirement for all benefits.
c. 403(b) RMDs may be aggregated.
b.
b. Yes
17. Taxation
a. Mandatory
Withholding
b. Early
Distribution Tax
c. Conversion to
Roth IRA
18. IRS
Qualification
Yes
c. Yes
c. Yes
19. Correction of
Defects
20. Code 416
Top Heavy Rules
EPCRS
EPCRS