Employers eligible to sponsor 403(b) retirement plans for their employees may want to consider adopting a pre-approved plan that has received a favorable letter instead of a having an individually designed plan.
Eligible employers that may sponsor a 403(b) plan are:
- 501(c)(3) tax-exempt organizations,
- public education organizations (Internal Revenue Code Section 170(b)(1)(A)(ii)),
- ministers (defined by IRC Section 414(e)(5)(A)), and
- a state, including a political subdivision of a state, or any agency or instrumentality of a state for its public school employees (IRC Section 170(b)(1)(A)(ii)). (An Indian tribal government is treated as a state (IRC Section 7871(a)(6)(B)).
A list of pre-approved plans can be found here (please keep in mind that this list is subject to change by the IRS).