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403 plans are a type of defined contribution retirement account available to certain employees of schools and various nonprofit organizations, including hospitals, charities and members of the clergy. They’re almost identical to 401 plans, which are the type used in the for-profit sector, with a few differences.

For the 2017 tax year, eligible employees can choose to have up to $18,000 of their salary deferred into their accounts, with an additional $6,000 catch-up contribution allowed […]

Next, the contribution percentages of the eligible employees in the NHCE group are added together, and an average is calculated. The contribution percentages of the eligible employees in the HCE group are added together, and an average is calculated. Each year, a 401 plan must complete specific nondiscrimination tests which are focused on deferral contributions and employer matching contributions. The test used to confirm that 401 deferral contributions are nondiscriminatory is called the actu […]