Money-Purchase Pension Plan

(redirected from Money-Purchase Pension Plans)

Money-Purchase Pension Plan

A defined contribution pension in which an employer must contribute an amount equal to a certain percentage of the employee's compensation, usually 25%. While the amount of employer contribution is fixed, the amount of benefit is not. There are also penalties associated with receiving payments from the pension before retirement. These contributions are tax-deductible for the employer and guarantee the employee a certain amount of principal in the pension plan.
References in periodicals archive ?
Two situations address money-purchase pension plans (MPPPs).
98-42,(22) which indicated that profit-sharing and money-purchase pension plans may operate in accordance with the repeal and be amended later, within the remedial amendment period.