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Stephanie

Getting A 457 Program

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Dear all - please help. I called my benefits office (a large non profit hospital) and they are unwilling to allow me to sign up for the 457 program. Based on information I read on this site, I'm not sure why not.

It seemingly contradicts some of the information here.

 

Here's the reply that I received:

 

Unfortunately its not that simple if the IRS/DOL deems the 457(b) inappropriate it not only effects you, but all of the other participants in the plan, so hence our concern and conservative approach, which we understand may differ from other organization.

 

Second you need to read the Internal Revenue Code (IRC) 403(b) which cross references IRC 401(m), in which cross references IRC 414(q) and thus its applicability.

 

Finally governmental 457(b) plan (which includes some teachers) are not the same as nonqualified 457(b). They are different animals and thus have different rules. Effectively a governmental 457(b) is equivalent to our 403(b) program.

 

Thanks,

S

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And further :

 

>>> Stephanie Hammonds 4/26/2006 11:17 AM >>>

Pardon me for being obtuse, but if you are citing this reference as the income lower limit for the 457 program, then it seems that it would be clearly spelled out.

Where does the confusion come from then, that the DOL did not establish a limit, if in fact they are linked?

I have cited your information to my discussion group about this topic in the event that they are disseminating bad information to the public.

Thanks,

S

 

His reply:

These are the IRS rules for qualified plans. The DOL has the authority over nonqualified plans and has no obligation to accept IRS guidance.

 

My next question:

And just to clarify - ours is a non-qualified plan? (yes, since we are large non-profit hospital).

So since the DOL has no obligation to accept the IRS guidance, technically, it would NOT apply to the 457 plans?

Thanks,

S

 

 

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