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Mike Glackin

457(b) Employer Contribution Vs. 401(a)

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Why wouldn't a township/municipality just make an employer contribution to the 457(b) plan vs. setting up a 401(a) plan in conjunction with a 457 plan?

 

 

 

One possible reason: Contributions made by employer to your 457 plan will count against your annual maximum contribution limit. Contributions in a 401(a) are applied against your annual maximum contribution limit as prescribed by section 415, which generally applies towards 403bs/401ks, and allow for a certain amount of employer contributions without reducing your personal contribution limits.

 

 

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