Both employers and employees may contribute to defined contribution plans. However, the amount that employees may contribute to the plan in a given year is limited by the tax law while the amount that employers may contribute is not.

Question

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Both employees and employers have contribution limits set by tax law for defined contribution plans, such as 401(k) plans. These limits are subject to annual adjustments by the IRS.

Both Employers and Employees May Contribute to Defined Contribution Plans