A money purchase pension plan is a type of defined contribution plan in which an employer makes fixed contributions to a tax-deferred retirement account. Unlike profit-sharing plans in which employer contributions are discretionary, employer contributions to a money purchase pension plan are fixed in advance. Each year, the employer must make fixed contributions based on an employee’s annual compensation. Like other defined contribution plans, money purchase pension plans contain underlying assets in which a filer has invested.
This guide is not intended to provide investment advice, and you should not rely on statements in this guide when making investment decisions.
Note: To return to the previous page, close this browser window.