gurus , 403B related question

H

hurricanemd

Registered Users (C)
i am a physician working for non for profit company who offers a 403B plan , but they don't contribute to it , but allow us to contribute on our own, they want us to channel contribution via a specific private company, can they make me do that even when they are actually not contributing a dime in the plan, whats the rule/ Law if applicable
thanks for feedback
 
Whats the point of 403b if the employer is not contributin? Is that even considered "employer sponsored retirement plan" . Whats the difference between that and an IRA ifemployer is not contributing? SOunds fishy to me.
 
i was under the impression that in 403B plan one can put 15k max /year, so if the employer does not contribute , can we still put 15k in any IRA of our choice.
 
Answers to 403B Contribution questions.....

If you are 49 (or less) years old you can contribute upto $ 15,500 in 2007(via 403b/401k plans). This is your contribution. (If employer gives a match - then it is additional). Your contribution is fully deductible from your income when you calculate your 'net' income at the time of filing tax returns. The rule also states that appropriate number (ratio) of low salaried as well as high salaried employees MUST participate in the plan. If only (or more) higher salaried employees participate then you cannot contribute fully and you will get a refund in Feb/March next year - and that amount is to be shown as your income.

403b/401k plans are managed by companies with whom your employer is contracted. You do not have a choice. Also you have to go by the funds offered by this company. (Companies like Vanguard or T Rowe Price charge less fees - but employees have no choice). Every year the employer is mandated to give the statement of expenses and cost to manage these accounts to all the participants.

IRA contribution is $ 4000 for 2007. You CANNOT contribute more than this. If you contribute to 403b via employers plan, you CANNOT claim deduction for the contribution to IRA. Here you can select your own funds/stocks/CDs etc. There is no penalties for early withdrawl(limited amounts) in IRA in very special circumstances like for college education of your kids or for the first time house buyers.

Even if your spouse is not working, you can still open an IRA account for her/him if you are employed - and contribute another $ 4000.

I hope this answers your questions. (ROTH IRA Vs Traditional IRA is altogether a different game.)
 
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