What Organizations Can Use 403(b)(9) Retirement Income Accounts?

Q: As a faith-based university that qualifies as a nonqualified church-controlled organization, can we utilize a 403(b)(9) retirement income account in our 403(b) plan?

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

A: One of the lesser-known provisions of the original Setting Every Community Up for Retirement Enhancement Act of 2019 provided an answer to this question. Under Section 111 of that Act, employees of nonqualified church-controlled organizationsnonqualified church, such as certain faith-based universities, church-affiliated hospitals, schools, nursing homes and retirement housing facilities, may be covered under a 403(b) retirement income account plan.

Of course, you will need to ensure that the recordkeeper for your plan can support a 403(b)(9) retirement income account before implementing such an arrangement.

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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