Schools choice of plans?

[John A]

May K-12 schools offer any plans other than 403(B) plans?

[jlf]

Assuming you are talking about elective deferral plans, yes they may. They may off Deferred Compensation plans under Code Section 457.

Best wishes,

Joel L. Frank

[Guest ksadler]

That is correct regarding the 457(g) plan. Effective Jan. 1 2002, public school employees may participate in both the 403(B) and 457(g). This means that the employee may contribute up to $22,000, not including catch-up provisions.

Also, the school may also elect to participate in a 401(a) matching plan. This can be utilized for additional benefits. For additional benefits

Both the 457(g) and the 401(a) plans can also be set up for seasonal and part-time employees as a FICA alternative plan. Saving the school district the matching part of the FICA.

Email me if you have any further questions.

sadler_kyle@hotmail.com

[GBurns]

Who sells these 401(a) plans?

I keep hearing about such plans but have not seen any marketing activity.

[QDROphile]

A 401(a) plan offering is not limited to a matching plan. The school could have any kind of 401(a), unless the school is governmental. Then it could not offer a 401(k) plan unless it had a grandfathered 401(k) plan available (see other threads).

[jlf]

GBurns asks: Who sells these 401(a) plans?

Answer: The same entities that sell all the other tax-favored retirement plans.

Peace,

Joel L. Frank

[Guest Tom Geer]

A governmental school can also have a post-tax thrift plan (post-tax, gains taxed on distribution), and should be able to have a Roth account feature (post-tax, gains not taxed on distribution). Also, I see no prohibition on the IRA-equivalent accounts for governmental plans.