davef Posted January 21, 1999 Posted January 21, 1999 If a DB plan requires, as a condition of employment, that employees contribute 5% of pay, can this contribution be made on a pre-tax basis? It seems that this could perhaps fall under the "one-time irrevocable election" exception contained in the 401(k) regs.
Chester Posted January 21, 1999 Posted January 21, 1999 Any employee contributions to a DB plan must be on a post-tax basis. The only qualified plan that allows for pre-tax employee contributions is a 401(k) plan.
jlf Posted February 2, 1999 Posted February 2, 1999 I believe Chester is wrong. Under IRC section 414(h) an employer may "pick up" the employee's contribution. It,thus, becomes a pre-tax contribution of the employee. ------------------
david rigby Posted February 2, 1999 Posted February 2, 1999 I believe the reference to 414(h) is for governmental plans only. We use it for several hospital plans where the hospital is owned by the county government. I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice.
Gary Posted February 16, 1999 Posted February 16, 1999 I agree with Pax, 414(h) applies to governmental employer "pickup" plans, not relevant to private employer plans.
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