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February 16, 2009

Nonelective Contribution



Employer contributions (other than matching contributions) with respect to which the employee may not elect to have the contributions paid to the employee in cash or other benefits instead of being contributed to the plan. Examples include :

Referring Cite

Treas. Reg. §1.401(k)-6

Additional Helpful Information

  • Nonelective contributions of up to 25% of eligible compensation paid to employees are deductible
  • Nonelective contributions to SIMPLEs are limited to 2% of the employee’s compensation
  • Nonelective contributions are subject to the compensation cap

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Qualified Charitable Distribution (QCD)

Definition A distribution that is excludable from the distributee’s income, as a result of meeting the following requirements: It is made after the distributee reaches

Saver’s Credit

Definition Also known as the Saver’s Tax Credit: Nonrefundable tax credit available to eligible individuals who make contributions to their retirement account. The saver’s credit

Catch-up Contribution

Definition An additional contribution that can be made to a retirement plan by a participant who is at least age-50 by the end of the

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IRA Rules