post-employment 403(b) contributions in a trust?

[maverick]

School district created a trust fund that is used to set aside money that will be used to pay the district's post-employment benefit obligations when teachers retire. This is usually done for health benefits, but now the district wants to do it with its post-employment 403(b) contributions.

Will the district somehow cause problems for its 403(b) plan by depositing money into one irrevocable trust now then using the money as a 403(b) contribution at some point in the future?

I searched the 403(b) forum and 403(b) answer book with no success, so I'm wondering if anyone has ever run into this in the past? Something doesn't seem right, but I can't put my finger on exactly what the "something" is. Thanks.

Maverick

[John Feldt ERPA CPC QPA]

If they are doing this with some specific participants in mind, then perhaps the IRS would consider such a contribution as a current 403(b) deferral, thus subject to FICA now and subject to current deferral limits?

[maverick]

No, they are not doing this with specific participants in mind; contributions would be made for anyone eligible (not just a retiring superintendent, etc.). Thanks.