Elective-Deferral Contribution

AAA

DEFINITION of 'Elective-Deferral Contribution'

A contribution arrangement of an employer-sponsored retirement plan under which participants can choose to set aside part of their pretax compensation as a contribution to the plan.

Also known as "salary-deferral" or "salary-reduction contributions."

INVESTOPEDIA EXPLAINS 'Elective-Deferral Contribution'

When making these contributions, employees defer the tax on the money until it is distributed to them.

RELATED TERMS
  1. Matching Contribution

    A type of contribution an employer chooses to make to his or ...
  2. Annual Addition

    The total dollar amount contributed in a given year to a participant's ...
  3. Nonelective Contribution

    A type of contribution an employer chooses to make to each of ...
  4. Employee Contribution Plan

    A company-sponsored retirement plan where employees may elect ...
  5. 401(k) Plan

    A qualified plan established by employers to which eligible employees ...
  6. Active Participant Status

    Active-participant status is a reference to an individual's participation ...
Related Articles
  1. Retirement

    I work for two companies. How much can I contribute to each company's SIMPLE IRA?

    It depends.If you work for two companies that are unrelated and unaffiliated, you can make salary deferral contributions of up to $20,500 between the two plans with no more than $13,000 going ...
  2. Retirement

    3 Reasons To Use An Employer-Sponsored Retirement Plan

    If you aren't participating in your employer-sponsored retirement plan, you're missing out! Learn the benefits.
  3. Savings

    3 Common Excuses For Not Contributing To A Retirement Plan

    If you're not participating in your employer-sponsored retirement plan, there may be some easy solutions.
  4. Retirement

    Can I contribute to my company-sponsored 401(k) after the company's year-end but before its tax-filing ...

    Unlike IRAs, where contributions can be made for the previous year up to April 15 of the current year, salary deferral contributions generally apply to they year in which they are actually withheld ...
  5. Options & Futures

    I have a KSOP through my employer that I've invested 100% in company stock. I am now concerned that ...

    In order to be sure of your options, it's best to check the summary plan description (SPD) for the plan. The options may vary for different plans. This should include an explanation of the rules, ...
  6. Retirement

    Where can I find information on multiple annual additions for someone employed by more than one unaffiliated ...

    That information can be found in Internal Revenue Code Section 402(g). Also see IRS Publication 571.If an individual participates in multiple retirement plans, the aggregate salary deferral among ...
  7. Options & Futures

    I have several jobs. Can I contribute the maximum to multiple employer retirement plans?

    It depends. A question such as this requires detailed information in order to provide a helpful response. Here is a general response that may be of help. Questions: Are any of these companies ...
  8. Retirement

    A Closer Look At The Roth 401(k)

    Learn about the benefits and drawbacks of this new investment account and see if it's right for you.
  9. Retirement

    Will My Pension Impact My Social Security Benefits?

    So you're eligible for a pension, and you're eligible for social security. And the question is, will that pension impact your social security benefit?
  10. Retirement

    Are part-time employees eligible for fringe benefits?

    Learn how offering fringe benefits allows employers to entice new talent to join their teams, although part-time workers do not often get these benefits.

You May Also Like

Hot Definitions
  1. Command Economy

    A system where the government, rather than the free market, determines what goods should be produced, how much should be ...
  2. Prospectus

    A formal legal document, which is required by and filed with the Securities and Exchange Commission, that provides details ...
  3. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  4. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  5. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  6. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
Trading Center