1. GOVERNMENTAL PL ANS OVERVIEW i
This table intends to provide an overview of retirement plan rules as they relate to and affect
governmental employers sponsoring 401(a) and 457(b) plans at the federal level. Note that state law
can sometimes affect and potentially even alter the application of these general federal rules.
Provision Governmental 401(a) Governmental 457(b)
ERISA Coverage ERISA does not apply, but may form the ERISA does not apply, but may form the
basis of plan governance best practices. basis of plan governance best practices.
Written Plan Document Required. Required.
Prototype Plan Document Available. Not Available.
Program
Model Plan Document Available. Available.
Program
Determination Letter Not required, but recommended. Not available.
Eligibility and Participation Any employee of the employer may be Only employees and independent
eligible. contractors who perform services for an
eligible governmental employer may
defer compensation into a governmental
457(b) plan.
Employees may be automatically
enrolled.
Exclusive Benefit Rule Applies. Applies.
Prohibited Transaction Rules Section 503 of the Internal Revenue Section 503 of the Internal Revenue
Code specifies prohibited transactions Code specifies prohibited transactions
applicable to governmental plans. applicable to governmental plans.
Specific state laws may also apply. Specific state laws may also apply.

2. Provision Governmental 401(a) Governmental 457(b)
Pre-tax Deferral Limit Not applicable; no pre-tax deferrals. Lesser of 100% of includible
compensation or $17,500 limit in 2013
for employee and employer contributions
combined, including deferrals of sick,
vacation and back pay if allowed by the
plan.
Employer contributions reduce the
457(e) deferral limits when those
contributions vest and are subject to any
applicable FICA taxes.
Employee contributions are mandated in
the event of a Social Security
replacement plan.
Excess contribution amount must be
distributed as soon as practicable upon
discovery and is taxable to the
participant in the year the excess
deferral was made to the plan.
Roth Not applicable. May allow Roth contributions and in-plan
Roth conversions.
Catch-up Contributions Not applicable; employer only money Participants age 50 or older during the
with employee after-tax contributions calendar year may make additional
potentially depending on plan design. contributions up to $5,500 in 2013,
subject to future indexing in $500
increments.
Participants within 3 years of normal
retirement age may make contributions
up to twice the otherwise allowable
annual amount to the extent of
underutilized deferrals from prior years.
Cannot use both types of catch-up in the
same year (the one allowing the
maximum contribution must be used).
Remittance of Employee Not applicable. Remit employer Must remit deferrals within a period that
Deferrals contributions in accordance with timing is reasonable for proper administration of
prescribed by the plan document. the plan. Generally this period, based on
the 457 model amendments, should be
no longer than 15 business days
following the end of the month in which
the amount would have been paid to the
participant. State law may apply.

3. Provision Governmental 401(a) Governmental 457(b)
Section 415 Contribution Applies. In 2013, limit is the lesser of Does not apply.
Limits $51,000 or 100% of compensation,
subject to future indexing in $1,000
increments. Picked-up contributions
under section 414(h)(2) are treated as if
they were not part of the employee's
compensation for purposes of the
section 415 limits, and they are not part
of the annual addition. However, benefits
generated by picked-up contributions are
subject to the limits of section 415(b).
Section 401(a)(17) Applies. Limit is $255,000 in 2013, Does not apply.
Compensation Limit subject to future indexing in $5,000
increments.
Trust Requirement Yes. Yes.
Funding Requirement Funded; not subject to the creditors of Funded; not subject to the creditors of
the employer. the employer.
414(h) Pick-up Governmental employers are permitted Governmental employers are permitted
Contributions to pick-up employee contributions in to pick-up employee contributions in
certain circumstances. certain circumstances.
Vesting All employer contributions must be fully Employee contributions are vested
vested either after three years (i.e. 100% immediately. Delayed vesting of
vested after 3 years of service), or in employer contributions should be
20% increments beginning with the avoided, as it could result in participants
employee's second year of service. Full exceeding annual limits.
vesting is required after the employee
has completed six years of service.
QDROs Apply. Rules may be broader than Apply. Rules may be broader than
ERISA exemptions would allow due to ERISA exemptions would allow due to
state law. state law.
Distributable Events Severance from service, age 59½, Severance from service, age 70½ or
disability or death. Hardship may be death. Unforeseeable emergency may
available. be available. Small account balances up
to $5,000 may be distributed without the
participant's consent.
Distribution Options Lump-sum, annuity, installments as Lump-sum, annuity, installments as
permitted by the plan. QJSA rules do not permitted by the plan. QJSA rules do not
apply. apply.

4. Provision Governmental 401(a) Governmental 457(b)
Early Withdrawal Yes, 10% before age 59½, including any Not applicable to amounts deferred
amounts rolled over from 457(b) under Section 457(b). 10% before age
governmental plans. 59½ for amounts rolled over from 403(b)
and qualified plans.
Rollovers Permitted to IRA, 401(a), 401(k), Permitted to IRA, 401(a), 401(k),
governmental 457(b) and 403(b) plans governmental 457(b) and 403(b) plans
that accept it. Not permitted to that accept it. Not permitted to
nongovernmental 457(b) plans. nongovernmental 457(b) plans.
Permitted from IRA, 401(a), 401(k), Permitted from IRA, 401(a), 401(k),
governmental 457(b) and 403(b) plans if governmental 457(b) and 403(b) plans if
allowed by plan provisions. Not permitted allowed by plan provisions. Not permitted
from nongovernmental 457(b) or from nongovernmental 457(b) or
nonqualified plans. nonqualified plans.
Minimum Required A governmental plan must meet the A governmental plan must meet the
Distributions distribution requirements of section distribution requirements of section
401(a)(9), which apply beginning on (a) 401(a)(9), which apply beginning on (a)
the later of the April 1 of the calendar the later of the April 1 of the calendar
year following the calendar year in which year following the calendar year in which
the employee attains age 70½ or the the employee attains age 70½ or the
April 1 of the calendar following the April 1 of the calendar following the
calendar year in which the employee calendar year in which the employee
retires, or (b) the employee's death. retires, or (b) the employee's death.
Taxability Amounts are taxable when distributed. Amounts are taxable when distributed.
Check state law. Check state law.
Withholding Reported on 1099-R; 20% withholding Reported on 1099-R; 20% withholding
applies to eligible rollover distributions applies to eligible rollover distributions
and special tax notice is required. and special tax notice is required.
Purchase of Service Credit Plan assets may be transferred to a DB Plan assets may be transferred to a DB
from a Defined Benefit Plan plan to allow for the purchase of service plan to allow for the purchase of service
credits within that plan. credits within that plan.
Loans Allowed, subject to 72(p) and plan rules. Allowed, subject to 72(p) and plan rules.

5. Provision Governmental 401(a) Governmental 457(b)
Nondiscrimination Under the Age Discrimination in Under the Age Discrimination in
(generally) Employment Act, a governmental plan Employment Act, a governmental plan
cannot limit or reduce benefit accruals on cannot limit or reduce benefit accruals on
account of age and may not prohibit plan account of age and may not prohibit plan
participation on account of age. Under participation on account of age. Under
Title VII of the Civil Rights Act of 1964, Title VII of the Civil Rights Act of 1964,
governmental plans cannot discriminate governmental plans cannot discriminate
in contributions or benefits on the basis in contributions or benefits on the basis
of sex. Other federal, state, and local of sex. Other federal, state, and local
civil rights statutes may also apply. civil rights statutes may also apply.
401(a)(4) and 401(m) Does not apply. Does not apply.
Nondiscrimination Testing
410(b) Minimum Coverage Does not apply. Does not apply.
Testing
416 Top-Heavy Testing Does not apply. Does not apply.
Form 5500 Filing Does not apply. Does not apply.
Requirement
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