401(a)
In the United States, a 401(a) plan is a tax-deferred retirement savings plan defined by subsection 401(a) of the Internal Revenue Code.[1] The 401(a) plan is established by an employer, and allows for contributions by the employer or both employer and employee.[2] Contribution amounts, whether dollar-based or percentage-based, eligibility, and vesting schedule are all determined by the sponsoring employer.[3]
These plans are available to some employees of the government, educational institutions, and non-profits, and their funds can be rolled over to a different qualified retirement plan, such as a 401(k) or IRA,[4] when changing jobs. Employer contributions are mandatory, while employees are not necessarily required to contribute to the plan.[5] Early withdrawals from the plan are permitted, but they may be subject to a penalty.[6]
See also
[edit]References
[edit]- ↑ "26 U.S. Code § 401 - Qualified pension, profit-sharing, and stock bonus plans". Legal Information Institute, Cornell University Law School.
- ↑ "What Is 401(a) Retirement Plan?". Zacks.com. Retrieved 2021-04-25.
- ↑ "What Is a 401(a) Plan and How Does It Work?". TheStreet.com. Retrieved 2021-04-25.
- ↑ "The 401(a) Plans and Rollover Rules (what you need to know)". GoodFinancialCents. 23 May 2017. Retrieved 2021-04-25.
- ↑ "401(A) PLAN". RetirementPlanAdvisors. Retrieved 2021-04-25.
- ↑ "401(a) Plan". Investopedia. Retrieved 2017-09-24.
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