The Reform Pension Plan is a defined contribution plan organized according to IRS 403(b) regulations. As such:
- The responsibility of the employer (congregation or other eligible institution) is defined by its contribution—a percentage of salary (including parsonage) or flat dollar amount—deposited to your retirement account.
- The Reform Pension Plan is also a church plan, as RPB provides benefits to employees of religious institutions
- Clergy who participate in RPB’s retirement plan are able to exclude their parsonage expenses from taxable income in retirement
- Contributions are either pre-tax or Roth after-tax. Pre-tax contributions reduce current taxation, and income tax on contributions and earnings is deferred until you take a direct distribution. Roth after-tax contributions are made with money that has already been taxed, and qualified earnings are distributed tax-free.
- Retirement benefits are based on your account balance at retirement.
- You and your employer are responsible for making regular annual contributions to your plan, which—in addition to any investment gains—will help ensure that you will be ready for retirement.