Go to Jeff Salisbury LWGate Home Page.From: JoAnne Freeman <jfreeman@polymail.cpunix.calpoly.edu>
Subject: In re: 457(f) plans
Date: Thu, 13 May 1999 12:10:21 -0700
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persfin-digest wrote: Date: Thu, 13 May 1999 10:37:24 -0700 From: rlee@muse.sfusd.k12.ca.us Subject: Re: 457(f) Does anyone know anything about 457(f) for non-profit institutions? Someone from an annuity company came to inform us about this available retirement plan in the place of 403(b). It seems to have a lot of good items compared to 403b. For instance, the contribution limit for this plan is up to annual salary. It doesn't have the $10,000 limit like 403b and so on and on. It sounds too good to be true. Can anyone shed some light on this investment item? Why haven't we heard about this? Is it new for non-profit institutions? For someone who is not making millions?=20 Thanks. =3D=3D=3D=3D=3D I found this using Alta Vista search engine and +457(f) and +help as key words... Types of Governmental Non-Qualified Plans 1. Code =A7457(b): "Eligible Deferred Compensation Plans". Deferred compensation is includible in the executive=92s gross income when the deferred compensation is received by the executive, even if the amounts become vested at an earlier date. Amounts credited under existing "Eligible deferred compensation plans" must be held "in trust for the exclusive benefit of participants and their beneficiaries" no later than January 1, 1999 (new EDCPs must use a trust immediately). EDCPs are subject to substantial limitations governing the amount of compensation deferred (i.e., generally, $7,500 annually, less any elective deferrals under Code =A7403(b) tax sheltered annuities and grandfathered 401(k) plans), and, therefore, such plans are of limited utility as executive benefit vehicles. The web site (which I know nothing of) is http://www.nappa.org/news-past/governmental_non.htm and this from a Fidelity site (dictionary) 457(f) Under Section 457(f) of the Internal Revenue Code, an employer can set aside money to supplement retirement income for a select group of employees in their organization. Since these programs are designed to attract and retain key employees and do not provide a benefit for all employees, these programs do not qualify for all of the tax advantages that are made available to 401(a) plans, for example. URL: http://www.403b.com/non-profits/dict/definitions.htm - -
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