FAQ - ANSWER

What is the difference between a 401(a) plan and a 401(k) plan?

Answer: People often refer to a 401(a) plan as an "employer only" contribution plan, i.e. the plan participants make no elective contributions. Usually when someone says 401(a), they mean a profit sharing plan, employee stock ownership plan or money purchase pension plan. But in reality, any qualified pension plan is a 401(a) plan, including a 401(k) plan. A 401(k) plan is a type of profit sharing plan and is a qualified plan under section 401(a) of the Internal Revenue code.