457(b) plans are non-qualified deferred compensation plans and are only allowed for non-profit organizations and government agencies. Assets are held under the plan sponsors name and remain on the plan sponsor's books until distribution. The employee does not take ownership of the assets until a benefit event has occurred or upon distribution.

Advantages of the 457(b) Plans:

  • Expanded salary and tax deferral opportunities
  • Plan integration limit eliminated
  • 457(b) plans no longer have to be integrated with the 403(b) or 401(k) deferral limits, which allows you to expand the deferral opportunities for highly compensated employees
  • There is a one time filing required when this plan is established. No other filings required with the IRS including no 5500 requirement and no accounting audits.

Disadvantages of the 457(b) Plans:

  • The portability of this plan is limited because it is an asset of the corporation. Employees can not roll the assets from this plan into any other plan type.

Plan Options
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