Nondiscrimination rule

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Nondiscrimination Rule

A provision of ERISA that requires employer-sponsored retirement plans to offer the same benefits in the same plans to all employees regardless of position in the company. That is, the nondiscrimination rule forbids employees of different rank from buying into the same plan and receiving different benefits. This protects both low income and high income employees. Plans violating the nondiscrimination rule are not tax deductible.

Nondiscrimination rule.

All qualified retirement plans, including 401(k) plans, must follow nondiscrimination rules. Among other things, the rules prevent highly paid employees from receiving more generous benefits than other employees.

However, employers may offer nonqualified plans to which antidiscrimination rules don't apply. Unlike contributions to qualified plans, contributions to nonqualified plans are not tax deductible.

References in periodicals archive ?
The WFE group health insurance plan could potentially fail nondiscrimination rules that the Affordable Care Act applies to insured group health plans, which, when implemented by the IRS, will apply on a controlled group basis.
4 Contributions to HSAs under Section 125 plans are subject to nondiscrimination rules.
Those rules are to be based on Internal Revenue Service regulations, not yet issued, and modeled on the nondiscrimination rules that apply to self-insured plans.
These resources, designed to help housing providers comply with HUDs nondiscrimination rules, were removed from HUDs website in recent months.
Representatives Pat Tiberi, R-Ohio, and Richard Neal, D-Massachusetts, both members of the House Ways and Means Committee, introduced updated legislation-the Retirement Security Preservation Act of 2017 (RSPA)-amending the nondiscrimination rules that apply to defined benefit (DB) plans that have been closed or frozen.
Manage the nondiscrimination rules and testing procedures for a 401(k) plan compliance
In the final rule, HHS also explicitly applies federal nondiscrimination rules to dental coverage, disability coverage, critical illness insurance, long-term care insurance and other health products other than major medical coverage.
They have run afoul of nondiscrimination rules because employees who are in them at the point they are closed-called "grandfathered" employees-continue to get raises, making that population in some senses "wealthier" than a company's general pension population.
But the proposal was opposed by most member states, which felt the idea went against on the Union's nondiscrimination rules and principles of free movement between member states.
Including the Houston council's 2014 vote on HERO, nine Texas cities with populations of more than 100,000 had passed nondiscrimination rules or legislation.
Nondiscrimination rules apply to any form of differential treatment
With nondiscrimination rules governing utilities, people get the same service.