457

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457

A retirement investment plan for employees of state and municipal governments in which a contributor defers taxation on contributions until after withdrawal. A worker places a portion of his/her pre-tax income into a 457 account and allows it to be invested. Taxation is deferred until withdrawal from the account, generally after retirement. 457s are employee benefits, and workers must have a sponsoring employer, such as a public school or a church, in order to take advantage of one. It is equivalent to a 401(k) and a 403(b); the main structural difference is that 457s may allow for higher catch-up contributions.

457.

These tax-deferred retirement savings plans are available to state and municipal employees.

Like 401(k) and 403(b) plans, the money you contribute and any earnings that accumulate in your name are not taxed until you withdraw the money, usually after retirement. The contribution levels are also the same, though 457s may allow larger catch-up contributions.

You also have the right to roll your plan assets over into another employer's plan, including a 401(k) or 403(b), or an individual retirement account (IRA) when you leave your job.

References in periodicals archive ?
Provide legal advice and consulting to the ARRC for its defined benefit pension plan, two 401(k) plans and a 457 plan.
With other pressing items such as the development of an operations center in the forefront, BMI put the 457 plan on the shelf.
So a taxpayer under age 50 who is saving for retirement in a conforming state would be allowed to contribute $11,000 to a 401(k) and $11,000 to a 457 plan.
457 plan contribution limits increase from the lesser of $8,500 or one-third of compensation in 2001 to the lesser of $15,000 or 100% of compensation in 2006.
Provide equitable tax treatment to Section 457 plan distributions made pursuant to a domestic relations order.
the definition of compensation under Section 415 is amended so that deferrals into a Section 457 plan are not taken into account in the limits on retirement benefits paid by qualified defined benefit plans.
Revenue Procedure 98-40 (Internal Revenue Bulletin 199832, 6--describes special procedures for obtaining a ruling from the IRS about a section 457 plan.
The tax code prohibits associations from rolling 457 plan assets into a 401(k).
The City is soliciting responses from qualified firms or individuals to provide analysis, advice, direction and general guidance to the Retirement Committee members regarding the fund structure, investment lineup, implementation, and administration of the Thrift Savings Plan (401k), the 457 Plan, the City of Arlington Part-time, Seasonal, Temporary Employee Deferred Income Plan, and City of Arlington Disability Income Plan.
Public employees also can participate in a supplemental [sections] 457 plan, which has about $300 million in total assets.
457 plan generally may not be paid or made available to a participant before separation from service with the employer.