403(b)/Tax Sheltered Annunities
A 403(b) plan is a retirement plan for certain employees of tax-exempt organizations: schools, government organizations and churches. Again, 403(b) plans provide an attractive benefit that appeals to high quality employees.
A 403(b) plan is funded primarily with employee contributions. Contributions are tax deferred and ma-y be excluded from an individual's gross income until withdrawn. Employees make contributions through payroll deductions which reduce their reportable earned income. For 2012 employees may contribute 100% of compensation or $17,000 whichever is less in regular contributions. The IRS refers to these as elective deferrals. Employers may also contribute to the plan on a fixed or discretionary basis. An additional $5,500 Catch-Up Contribution is allowed for workers age 50 and older.
Corporate Financial Services helps organizations to design, implement and administer these types of plans.