AALU WRMarketplace 14-26

Deferred Compensation for Tax-Exempt Organizations (Part I) – Tax Qualified Arrangements

To provide deferred compensation using a tax-qualified arrangement, tax-exempt employers can offer the typical 401(k) plan as well as the 403(b) tax-sheltered annuity plan. Although the rules governing 401(k) plans and 403(b) plans have become increasingly similar over time (e.g., similar annual contribution limits apply to each arrangement), significant differences remain, particularly with regard to the ability to structure 403(b) plans as exempt from ERISA. The link below summarizes the requirements for obtaining ERISA exemption for a 403(b) plan and similarities and differences in the rules governing the tax-qualification requirements applicable to both plans.

Learn more about the requirements for obtaining ERISA exemption for a 403(b) plan and similarities and differences applicable to both plans in the new Washington Report.

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