Is Deferred Comp 457?

A deferred compensation plan is another name for a 457(b) retirement plan, or “457 plan” for short. Deferred compensation plans are designed for state and municipal workers, as well as employees of some tax-exempt organizations.

What is deferred comp Sec 457?

A 457 deferred compensation plan allows you to save and invest money for retirement with tax benefits. The value of the account is based on the contributions made and the investment performance over time. A 457 plan is designed to supplement your retirement income.

How do I check my 457 plan?

For more information, visit the CalPERS 457 Plan website, call the Plan Information Line at (800) 260-0659, or view the additional resources below.

How much tax will I pay on my 457 withdrawal?

5 457(b) Distribution Request form 1 Page 3 Federal tax law requires that most distributions from governmental 457(b) plans that are not directly rolled over to an IRA or other eligible retirement plan be subject to federal income tax withholding at the rate of 20%.

How is my deferred compensation taxed?

How deferred compensation is taxed Generally speaking, the tax treatment of deferred compensation is simple: Employees pay taxes on the money when they receive it, not necessarily when they earn it. For example, say your employer provides you $80,000 a year in salary and $20,000 a year in deferred compensation.

What is deferred comp plan?

A deferred compensation plan is a plan in which a portion of an employee’s income is set aside for a later purpose, usually retirement.

How does deferred compensation work?

Deferred compensation is an agreement between an employer and an employee in which a portion of their earnings, or compensation for work performed, is held back, or deferred, for payment at a future time. It is widely used as a retirement savings plan. An employer may offer a retirement plan to their employees as…

What is deferred compensation distribution?

Deferred compensation is a type of employer-sponsored benefits plan where a company places assets into a special account. The employees are able to take the compensation at a later date. The year of distribution of the deferred compensation is when the income is added to adjusted gross income often when income is lower, such as in retirement.