What is a 403b employee retirement plan?
A 403b employee retirement plan is a tax-advantaged plan run by the employer for the benefit of the employees. A 403b plan is very similar to a 401k plan except 403b plans are for nonprofits and education employees rather than those of for-profit corporations.ContributionsYou make contributions to your 403b plan through your employer with pretax money, which means the contributions are not counted as part of your income for tax purposes.Contribution LimitsThe contribution limit for a 403b plan adjusts each year for inflation and allows an extra “catch-up” contribution for people 50 and older. For 2010, the contribution limit is $16,500 and the catch-up contribution is $5,500.Tax ImplicationsWhile the money remains in your 403b account, you do not pay taxes on any of its growth. However, when you take withdrawals, you must include the amount of the withdrawal as taxable income.WithdrawalsYou can start taking qualified withdrawals at age 59 1/2 regardless of whether you keep working. If
