Guest Sally Gordon Posted January 22, 2002 Posted January 22, 2002 My company is just setting up a 403B, of which I am the administrator, and my payroll company tells me that FICA must be taken out of the employee contribution. It is my understanding that all contributions, up to the yearly limit, are completely tax free - that all deductions will be taken when disbursements are taken upon retirement, disability, etc. What is the correct information? Sally G
Carol V. Calhoun Posted January 22, 2002 Posted January 22, 2002 Salary reduction (i.e., pretax) contributions to a 403(B) are an exception to this rule. They are exempt from income tax, but subject to FICA, when contributed. See Internal Revenue Code 3121(v). 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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