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Plan Types 401(a)/403(a) Profit Sharing Plan This information is general in nature and may be subject to change. Neither AIG VALIC nor any of its agents give legal or tax advice. Applicable laws and regulations are complex and subject to change. For legal or tax advice concerning your situation, you should consult your attorney or tax advisor. Type of employer? Any type of employer may adopt. ERISA-covered? Yes, unless governmental or non-electing church organization. ERISA imposes specific requirements including annual reports for the IRS; written plan document and summary plan descriptions for participants; joint and survivor benefits; spousal consent; and fiduciary obligations. Initial filing with the IRS? Yes, unless a standardized prototype plan document is used, in which case the plan sponsor can rely on the prototype sponsor's opinion letter from IRS. Filing fees? IRS fees vary, based on type of filing. However, filing is not necessary if sponsor uses a standardized prototype plan document. Annual reporting to IRS? Yes, unless governmental or non-electing church organization. Nondiscrimination coverage rules? Yes, for non-governmental tax-exempt and for-profit organizations. Trustee required? Yes, unless plan is funded with an annuity contract. Rollovers? If eligible, to a 401(a), 403(a), 401(k) or IRA. Permitted investments? A broad range of investment alternatives, including annuity contracts and mutual funds. Loan provisions? Yes, if permitted by plan. Subject to Internal Revenue Code and/or ERISA limitations. Eligibility requirements? Minimum — all employees from date of hire. Maximum — Later of one year of service or age 21, unless immediate vesting, then later of two years of service or age 21. Eligibility for annual contributions? According to years-of-service definition (but could be separate hours requirement or last-day-of-plan-year requirement) in the plan, subject to limitations. Annual contribution amount? Discretionary amount. Maximum employer tax deduction? 25% of total compensation paid to all participants collectively. Pre-tax employee contributions are not permitted. Maximum contributions per participant? Combined employer and employee contributions for each eligible employee may not exceed 100% of the employee's compensation up to a maximum of $40,000, usually coordinated with other employer-sponsored plans. Vesting? As permitted by Internal Revenue Code. Integration with Social Security? Allowed. Distributions to employee? Determined by plan provisions, including the employee's vesting percentage and applicable tax laws. However, minimum distributions are required at age 70½ or retirement, whichever is later. #40015