Pierson
Dec 4 2000, 04:24 PM
Is a defined benefit plan considered a qualified retirement plan?
Brian4
Dec 4 2000, 05:04 PM
It depends. Being a defined benefit or a defined contribution plan is one way to classify plans. Whether the plan is a qualified plan or not is another. For the question if a plan is qualified or not, it would help if you gave a context for your question.
A typical employer sponsored defined benefit pension plan covering all employees, salaried employees, or hourly employees is usually a qualified plan, meaning it is qualified under the Internal Revenue Code. Many large corporations sponsor supplemental executive retirement plans, which can be defined benefit plans. But, these plans are generally nonqualified plans. Consequently, the employers tax deduction is usually deferred until the benefit checks to the retired executives are written.