Specialized for organizations
A 403(b) plan is also known as a tax-sheltered annuity (TSA) plan. 403(b) plans have similar features to 401(k) plans that are sponsored by for-profit companies. However, the employee salary deferrals made to a 403(b) plan are not subject to discrimination testing that applies to a 401(k) plan. For this reason, most qualifying organizations would elect to sponsor a 403(b) plan as compared to a 401(k) plan.
This type of plan can only be sponsored by:
– Public Schools
– Tax-exempt hospitals
– Nonprofit organizations that are tax-exempt under section 501(c)(3)
For additional information about Defined Benefit plans, contact us!