While these employer sponsored retirement plan are most common at the state and local government, many not‐for‐profit entities can utilize these plans as a “top hat” plan for executives. Not‐for‐profit entities will sponsor both a 403(b) and a 457(b) plan simultaneously so their executives can contribute $19,500 or $26,000 pre‐tax to the 403(b) and an additional $19,500 or $26,000 pre‐tax to the 457(b). A huge tax advantage. The plans are not allowed to cover “rank‐and‐file” employees.
Not to be confused with 457(b) plans, 457(f) plan are nonqualified deferred compensation arrangements which have more in common with the for‐profit world executive deferred compensation plans. Unlike a 457(b) plan, the assets do not belong to the employee until there is no longer a “substantial risk of forfeiture”. The assets in 457(f) plans are property of the employer and are available to the organizations general creditors in the event of bankruptcy. There are no set dollar limits for the amount of the annual contribution to these plans. These plans are often referred to as the “golden handcuffs”.
Welcome To Our Virtual Retirement Plan Services
For companies located outside of the Capital Region, we designed a virtual employer sponsored retirement plan platform that allows us to offer our clients:
- Easy Plan Setup
- Plans Consulting
- Low Fees
- Flexible Investments
- No Call Centers
- Employee Education (if applicable)
- Retirement Planning
- Video Conferencing For Review Meetings