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Government plans


Guest eamaly

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Guest eamaly

Can someone please help me understand what plan(s) are available to government entities. For some reason I was under the impression that municipalities could sponsor a 401(k). True? Not true? If not, what are the available choices for local government outside of a 457?

Thanks in advance :(

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A 401(k) plan is currently (with very limited exceptions) unavailable to employees of a state or local government unless the "employer" sponsored one before a transitional date set forth in the statute.

A local governmental entity can sponsor a 457(B) plan. If it is a public school or university, or a governmental instrumentality that has obtained status as a 501©(3) organization, it can sponsor a 403(B) plan. And in some instances, it can sponsor a simplified employee pension ("SEP").

There are other types of plans available (e.g., a defined benefit plan, a profit-sharing plan, or a money purchase pension plan. But the ones set forth above are the primary ones that allow employees to make elections as often as annually to make pretax contributions.

Employee benefits legal resource site

The opinions of my postings are my own and do not necessarily represent my law firm's position, strategies, or opinions. The contents of my postings are offered for informational purposes only and should not be construed as legal advice. A visit to this board or an exchange of information through this board does not create an attorney-client relationship. You should consult directly with an attorney for individual advice regarding your particular situation. I am not your lawyer under any circumstances.

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