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Coverage Requirements


John A

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Posted

What are the coverage requirements for an employer-contribution only, nonelecting, 403(B) church defined contribution plan? Is it possible to exclude groups of employees (pre-school employees paid from the church's payroll, bookstore employees paid from the church's payroll, part-time employees, etc.) from getting a contribution while all other employees get a uniform percent (like 5%) of compensation?

Guest Danny Miller
Posted

403(B) retirement programs maintained by churches (i.e., the "steeples" and church ministry organizations controlled by and heavily supported by the church) are not subject to the nondiscrimination and coverage rules that would otherwise apply to 403(B) arrangements. However, church affiliated hospitals, colleges and universities are subject to such rules. See Internal Revenue Code section 403(B)(1)(D) and 403(B)(12)(B) for the basis for this exemption.

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Danny Miller

Conner & Winters

1050 17th St., N.W.

Suite 810

Washington, D.C. 20036

(202) 783-5711

dmiller@cwlaw.com

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