Why a Cash Balance plan vs. traditional plan
- Better understood by employees
- More predictable costs
- Better able to target key staff
- Ideal for professional groups
Is there a maximum I can contribute each year?
The IRS limits total tax deductible employer contributions for the combined plans (Defined Benefit Pension Plan & 401(k)/PS) to the greater of 25% compensation or the minimum required for the Defined Benefit Pension Plan. As the 1st 6.0% of DC contributions do not count toward the 25% limit, the effectively limit is 31% for non-PBGC covered plans. For PBGC covered plans, the 25% limit does not apply.
Does it matter how old I am?
Yes, the tax deductible contributions vary by age. To view the estimated annual contribution limits download our white paper below.