What is ERISA?

The Employee Retirement Income Security Act of 1974 (ERISA) was enacted by Congress to protect the interests of employee benefit plan participants and their beneficiaries. ERISA is administered by the Department of Labor. ERISA establishes the minimum standards for retirement plan activities in private industry. It also provides for the rules on the federal income tax effects of transactions within retirement plans.

The primary functions of ERISA include:

Requires the disclosure of financial and other information concerning the plan to participants and their beneficiaries;
Establishes standards of conduct for fiduciaries; and
Provides for appropriate remedies and access to the federal courts.

What is Non-ERISA?

Non-ERISA plans are those 403(b) plans that involve voluntary plan participation only. In other words, the employer is not contributing. It’s important to note that Non-ERISA plans do not have the same regulations as ERISA plans, but they also do not have the same protection value as ERISA plans.

Is Your Retirement Plan ERISA or Non-ERISA?

It is important that you know if your organization’s retirement plan is an ERISA plan or a non-ERISA plan. Compliance differs greatly between the two plan types. Your organization’s governing Plan Document will clearly outline if the plan is an ERISA plan or a non-ERISA plan. 401(k) retirement plans are generally subject to ERISA.

Are Church Retirement Plans Subject to ERISA?

All Church Plans are 403(b)(9) plans and are automatically classified as Non-ERISA.

Non-ERISA plans need to conform to the 403(b) regulations as established by the Internal Revenue Service.

ERISA plans need to conform to the 403(b) or 401(k) regulations as established by the Internal Revenue Service and the ERISA regulations as established by the Department of Labor.

Visit Understanding ERISA Vs. Non-ERISA Retirement Plans to learn more about ERISA vs. Non-ERISA plans.