Employer-Based Defined Contribution Plans in Oregon Divorce Mediation:
Mediator Matthew M. House, J.D.

A defined contribution plan is one to which the employer and usually the employee will make regular contributions. The four types of defined contribution plans that Matthew sees most often in divorce mediation are 401(k), 403(b), 457(b), and SEP IRA. All three types of accounts are funded with pre-tax dollars, so the contributions are excluded from taxable income. The assets are not taxed until they are wtihdrawn, usually in retirement but sometimes for other reasons. 

The main difference among the three types of pre-tax accounts is the type of employer:

• 401(k): Private, for-profit businesses
• 403(b): Public schools, churches, and some nonprofit organizations.
• 457(b): Certain state and local governments and certain tax-excempt nongovernmental entities.
• SEP IRA: Self-employed individuals and small business owners
• SIMPLE IRA: Small business owners, but less common than SEP IRA

Each of the links above will take you to a dedicated page for that account type. Although the various types of accounts have many common attributes, there are differences as well. Matthew will discuss each account that you may have.