403(b) & 457 Plan Administration

Retirement plans designed for nonprofits, schools, healthcare institutions, and government entities, Admin316 manages the fiduciary administration and compliance responsibilities unique to these plan types so your organization stays fully protected and compliant.

On this pageWhat it is How it works 2026 limits Where sponsors get hurt FAQ

What Are 403(b) and 457 Plans?

A 403(b) plan is the retirement plan for public schools, colleges, hospitals, churches and 501(c)(3) nonprofits. A 457(b) plan is a deferred compensation plan for state and local governments and, in a very different form, for a select group of management at tax-exempt employers. They look like a 401(k) from the participant's chair and behave nothing like one underneath.

The differences matter. A 403(b) that receives employer contributions or is not purely voluntary is an ERISA plan with Form 5500 and audit obligations. Governmental 457(b) assets are held in trust for participants; tax-exempt "top hat" 457(b) assets remain the employer's property, subject to creditors, and eligibility is legally limited. Getting that classification wrong is the most expensive mistake in this space.

How These Plans Work, Step by Step

1. The plan type is determined

ERISA 403(b) vs. non-ERISA 403(b) vs. governmental 457(b) vs. tax-exempt top-hat 457(b) — each with its own reporting, eligibility and asset-ownership rules.

2. Universal availability applies (403(b))

If any employee can defer, essentially all employees must be offered the chance to defer, with a meaningful annual notice. Very few exclusions are allowed.

3. Employees defer, employers may contribute

Deferrals to a 403(b) go to annuity contracts or custodial accounts. Employer contributions in a 403(b) make it an ERISA plan in most nonprofit settings.

4. Vendors and information sharing

Multi-vendor 403(b)s require information-sharing agreements so loans, hardships and required distributions can be administered across providers.

5. Testing and limits

403(b) employer contributions face 410(b)/401(a)(4) testing (governmental and church plans excepted). 457(b) has its own separate annual limit.

6. Reporting

ERISA 403(b) plans file Form 5500 and require an audit at scale. Governmental plans do not, but still carry documentation and distribution rules.

2026 Limits

Limit	2026 amount	Note
403(b) elective deferrals	$24,500	Shared with any 401(k) the person also participates in.
457(b) deferrals	$24,500	Separate limit — an employee with both can defer to each.
Age 50+ catch-up	$8,000	Not available in tax-exempt (non-governmental) 457(b) plans.
Ages 60–63 catch-up	$11,250	SECURE 2.0 window, where the plan permits it.
403(b) 15-year service catch-up	Up to $3,000/year, $15,000 lifetime	Qualified organizations only; requires historical deferral records most employers no longer have.
457 final-three-year catch-up	Up to twice the annual limit	In the three years before the plan's normal retirement age; cannot be combined with the age-50 catch-up.
Annual additions — IRC 415(c)	$72,000	403(b) only; 457(b) has no 415(c) limit.
Compensation cap — 401(a)(17)	$360,000

Source: IRS Notice 2025-67, 2026 cost-of-living adjustments.

Where Plan Sponsors Get Hurt

Universal availability failures. Excluding part-time, adjunct, substitute or student employees without meeting the narrow rules, or never sending the annual notice. This is the number-one IRS finding in 403(b) examinations.

Accidental ERISA status. A "voluntary" 403(b) where the employer chose the vendors, negotiated terms or endorsed the program — now with years of unfiled Form 5500s.

Legacy vendors with no information-sharing agreement. Loans and hardships approved in the dark; aggregate limits impossible to police.

Top-hat 457(b) eligibility creep. Letting non-management employees in destroys the exemption and makes the deferrals immediately taxable.

Double-catch-up errors combining the 15-year and age-50 catch-ups incorrectly, or applying an age-50 catch-up in a tax-exempt 457(b) where it does not exist.

Who It Fits

Public schools, universities, hospitals and 501(c)(3) nonprofits — the 403(b) is their native plan.
State and local governments offering a 457(b) alongside a pension.
Nonprofits that want to give key executives a second deferral bucket through a top-hat 457(b).

Where It Falls Short

Employers wanting broad-based executive deferrals — a tax-exempt 457(b) legally cannot be broad-based.
Organizations unwilling to consolidate legacy vendors; administration cost and risk stay high.

How Admin316 Fits

Admin316 serves as 3(16) Plan Administrator and 402(a) Named Fiduciary for ERISA 403(b) plans and provides the same administrative discipline for governmental and top-hat arrangements. We document universal availability and issue the annual notice, reconcile deferrals across vendors, chase information-sharing agreements, police the separate 403(b) and 457(b) limits and catch-up eligibility, manage loans, hardships and distributions, coordinate the audit, and sign and file the Form 5500.

Frequently Asked Questions

Can an employee contribute to both a 403(b) and a 457(b) in the same year?

Yes. The 457(b) limit is separate from the 402(g) limit that covers 403(b) and 401(k) deferrals, so for 2026 an eligible employee may defer up to $24,500 to each, plus any catch-up the plans permit.

What is universal availability in a 403(b) plan?

If a 403(b) plan lets any employee make elective deferrals, it must effectively offer the same opportunity to all employees, with only narrow statutory exclusions, and must give a meaningful notice of the right to defer at least annually. Failing this is the most common IRS finding in 403(b) audits.

Does a 403(b) plan have to file a Form 5500?

An ERISA-covered 403(b) does — generally any plan with employer contributions or meaningful employer involvement — and it needs an independent audit once it is a large plan. Governmental and church plans, and genuinely voluntary non-ERISA 403(b)s, do not file.

Is a 457(b) plan at a nonprofit the same as one at a city or school district?

No. Governmental 457(b) assets are held in trust for participants. Tax-exempt 457(b) plans are unfunded top-hat arrangements: assets remain the employer's and are subject to its creditors, participation must be limited to a select group of management or highly compensated employees, and the age-50 catch-up is not available.

Educational information only. Plan design and administration outcomes depend on your specific facts, plan document and demographics. Nothing here is legal, tax, investment or actuarial advice, and reading it does not create a fiduciary or client relationship. 2026 dollar limits are from IRS Notice 2025-67.

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We Work Alongside Leading Recordkeepers & Plan Providers

What Admin316 Does For Your 403(b) & 457 Plan

403(b) and 457 Plans Have Unique Compliance Requirements Most Organizations Miss

Unlike 401(k) plans, 403(b) and 457 plans operate under specific IRS and DOL rules that many nonprofit and government employers are unaware of. From universal availability requirements for 403(b) plans to strict distribution restrictions for 457 plans, these plans carry compliance obligations that are frequently mismanaged, exposing organizations and their leadership to significant regulatory risk, penalties, and potential plan disqualification.

Universal Availability Requirements

457 Distribution Restrictions

Annual Filing & Disclosure Obligations

Admin316 Assumes Your 403(b) & 457 Plan Administration

Admin316 serves as your 3(16) Plan Administrator and 402(a) Named Fiduciary for your 403(b) or 457 plan, assuming the administrative responsibilities that would otherwise rest on your shoulders. We handle contribution oversight, participant allocations, compliance filings, and year-round plan operations while working alongside your existing advisor and recordkeeper.

3(16) & 402(a) Fiduciary Administration

Eligibility & Notice Management

Works With Your Existing Team

Responsibilities We Handle on Your Behalf

From participant notices to contribution monitoring, Admin316 takes over every administrative fiduciary obligation tied to your 403(b) or 457 plan, removing compliance risk from your organization entirely and giving your leadership team complete peace of mind.

Participant Notices & Form 5500

Contribution Monitoring & Allocations

Compliance Coordination Year-Round

7 Responsibilities Admin316 Handles For Your 403(b) & 457 Plan

When Admin316 serves as your 403(b) or 457 plan administrator, these responsibilities are removed from your plate entirely.

Participant Notices

We prepare and distribute all required ERISA participant notices, ensuring every employee receives accurate, timely communications about the 403(b) or 457 plan.

Form 5500 Oversight

We coordinate and oversee the preparation and timely filing of your Form 5500 annual report, protecting your organization from late filing penalties and DOL scrutiny.

Eligibility Monitoring

We track employee eligibility for plan participation, ensuring all eligible employees are correctly identified and enrolled per your plan document terms.

Loan & Hardship Review

We review and process participant loan requests and hardship withdrawal applications in full compliance with plan provisions and IRS regulations.

Distribution Approvals

We review and approve participant distribution requests, ensuring all distributions from the 403(b) or 457 plan are processed correctly and compliantly.

Contribution Monitoring

We monitor employer contribution deposits and participant allocations, ensuring accuracy, timeliness, and full compliance with DOL deposit timing requirements.

What You Gain When Admin316 Manages Your 403(b) & 457 Plan

403(b) and 457 plans carry compliance requirements that most nonprofit and government employers are not equipped to manage alone, Admin316 brings over 25 years of exclusive ERISA expertise to ensure yours is administered correctly and without personal risk to your organization.

Reduce Liability

We assume the administrative fiduciary responsibilities that make profit sharing plan sponsorship personally risky, protecting your business owners and HR team from direct IRS and DOL exposure.

Save Time

Your team no longer manages contribution tracking, participant allocations, or annual filings, Admin316 handles every administrative obligation tied to your profit sharing plan.

Preserve Advisor Relationships

We coordinate with your existing advisor and recordkeeper without replacing or disrupting those relationships, we plug in as the fiduciary layer that was missing.

Improve Plan Governance

Admin316 creates a documented, defensible governance structure for your profit sharing plan, reducing audit risk and giving your organization a clear fiduciary framework year-round.

client reviews

Admin316 Client Result

Plan Sponsor · Admin316 Client

Over $142,000 in Client Penalties Avoided

"Admin316's analysis of our DOL filings uncovered excessive fees and saved our company more than $142,000 annually."

"Admin316 has made managing our retirement plan significantly easier. Their team is responsive, knowledgeable, and proactive about the administrative responsibilities that used to take time away from our internal team. Having experienced professionals helping oversee the plan gives us greater confidence that important details aren't being overlooked."

Racheal Admin316 Client

"Working with Admin316 has taken a tremendous amount of administrative work off our plate. They understand the responsibilities that come with sponsoring a retirement plan and help make sure things get handled correctly and on time. The biggest benefit for us has been having a team we can rely on instead of trying to manage everything internally."

Ron Admin316 Client

"Admin316 brought structure and accountability to the way we manage our retirement plan. They helped us better understand who was responsible for what and took over many of the administrative responsibilities our team had been handling. Their knowledge and responsiveness have made them a valuable partner to our organization."

Scott Admin316 Client

"One of the best things about working with Admin316 is knowing there is a team focused on the details of our retirement plan every day. They are proactive, accessible, and willing to explain issues in plain English. It has allowed our management team to spend less time worrying about plan administration and more time running our business."

Paul Admin316 Client

"Admin316 helped simplify what had become a complicated and time-consuming responsibility for our company. Their team has been professional, responsive, and easy to work with. I especially appreciate having a clear process and knowing exactly who is responsible for getting things done."

Ryan Admin316 Client