Business of Benefits

Business of Benefits

Tag Archives: Collective Trust

A 403(b) Collective Trust? A Note of Caution…..

Posted in 403(b), B/D-IA Issues
Two issues need to be addressed with a 403(b) plan's purchase of the collective trust interests of the sort that are typically sold to 401(k) plans: Code Section 403(b) only permits investments in mutual funds and annuity contracts. The CIT interests purchased by 401(a) plans, however, are typically "unitized" non-mutual fund interests. Even if one could overcome the legal and logistical challenges to making them work for the IRS 403(b) rules, there is a serious securities law problem. … Continue Reading
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