CASH OR DEFERRED ARRANGEMENTS (CODAs) 401(k)
01.Core Concepts
• Most prevalent type of plan established today • Predominantly funded by employee deferral contributions • Attaches to a profit-sharing plan or stock bonus plan • Permits employees to defer compensation to a qualified plan • Limited to $23,500 for 2025 per year, or • $31,000 for 2025 (age 50+), or • $34,750 for 2025 (age 60-63) • Limit applies per individual, no matter how many employers’ plans the individual is eligible to participate in • Employers may (but are not required to) match employee deferrals