Are CITs Approved as Investments in 403(b) Plans?

Q: I noticed that it has been more than two years since the Experts shared information about the possibility of CITs in 403(b) plans. Any update?

Kimberly Boberg, Kelly Geloneck, Emily Gerard and David Levine, with Groom Law Group, and Michael A. Webb, senior financial adviser at CAPTRUST, answer:

A: Since that 2023 Ask the Experts column, legislation has been introduced in both the House and Senate that would amend the appropriate securities laws to permit collective investment trusts in 403(b) plans.

Though we anticipate that the proposed legislation will be acted upon at some point, there is no timeline at present for the inclusion of CITs in 403(b) plans. Until that point, 403(b) plans that are not church retirement income accounts under 403(b)(9) generally remain restricted to annuity contracts and mutual funds.

NOTE: This feature is to provide general information only, does not constitute legal advice and cannot be used or substituted for legal or tax advice.

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