Sarah Logan is a professor at a public university.Her employer makes nontaxable contributions to a plan in her name and reduces her salary by the same amount.What type of retirement plan does Sarah have?

Question

Quizplus · Accepted Answer

Sarah Logan's situation describes a 403(b) plan, which is common for employees of public schools and certain tax-exempt organizations. Her employer's contributions to the plan in her name, with a corresponding salary reduction, is characteristic of 403(b) plans, allowing for pre-tax contributions to be made directly from her salary.

Sarah Logan Is a Professor at a Public University