Available only to hospitals, educational institutions, churches
or organizations that are tax-exempt under section 501(c)(3) of the
Internal Revenue Code. These plans allow employees to defer a
portion of current income on a pre-tax basis. The deferral limits
are the same as those under a section 401(k) provision.
Catch-up contributions in addition to those discussed relative
to 401(k) deferrals are available under special rules prescribed by
the Internal Revenue Service.
An employer may match salary deferral contributions. However,
since these organizations can also maintain 401(k) profit-sharing
plans, if matching contributions are desired, they may be provided
more effectively through a 401(k) profit-sharing plan.