Public Pensions:
Section 457 Plans Pose Greater Risk Than Other Supplemental Plans
HEHS-96-38: Published: Apr 30, 1996. Publicly Released: May 15, 1996.
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Pursuant to a congressional request, GAO reviewed the status of public pension funding, focusing on how plans established under Internal Revenue Code (IRC) section 457 differ from plans created under IRC sections 401(k) and 403(b).
GAO found that: (1) most state and local government employees are covered under section 457 plans because the Tax Reform Act of 1986 prohibited state and local governments from establishing plans under sections 401(k) and 403(b); (2) section 457 plan participants risk losses if sponsoring governments go bankrupt or the deferred monies are mismanaged or lost; (3) section 457 does not require sponsoring governments to maintain deferred monies to pay future benefits; (4) section 457 plan participants risk losses because sponsoring governments may view deferred monies as available for public use; (5) while funds enrolled in section 401(k) and 403(b) plans can be transferred to investment retirement accounts (IRA) when the employee leaves state or local government employment, amounts payable from section 457 plans can only be rolled over into other section 457 plans; (6) section 457 plan participants must declare a fixed date for when they will begin receiving their benefits shortly after retiring or leaving employment; (7) according to IRS, the transfer of section 457 plan deferrals into IRA or allowing plan participants to change their distribution dates would create a taxable event or be incompatible with the plan's tax deferred condition of government ownership; (8) section 457 plans allow a lower maximum annual employee deferral and employer contribution than section 401(k) and 403(b) plans, and are not indexed; and (9) new legislation could increase the section 457 plan deferral and contribution limit and index section 457 plans to inflation.
Jun 4, 2018
Central States Pension Fund:
Department of Labor Activities under the Consent Decree and Federal LawGAO-18-105: Published: Jun 4, 2018. Publicly Released: Jun 4, 2018.-
Central States Pension Fund:
Investment Policy Decisions and Challenges Facing the PlanGAO-18-106: Published: Jun 4, 2018. Publicly Released: Jun 4, 2018.
May 22, 2018
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Retirement Plan Investing:
Clearer Information on Consideration of Environmental Social and Governance Factors Would Be HelpfulGAO-18-398: Published: May 22, 2018. Publicly Released: May 22, 2018.
May 21, 2018
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Railroad Retirement Board:
Additional Controls and Oversight of Financial Interchange Transfers NeededGAO-18-323: Published: Apr 19, 2018. Publicly Released: May 21, 2018.
May 17, 2018
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Social Security Administration:
Observations on Use and Costs of Social Security CardsGAO-18-507T: Published: May 17, 2018. Publicly Released: May 17, 2018.
Mar 7, 2018
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Social Security Administration:
Continuing Leadership Focus Needed to Modernize How SSA Does BusinessGAO-18-432T: Published: Mar 7, 2018. Publicly Released: Mar 7, 2018.
Mar 5, 2018
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Workplace Retirement Accounts:
Better Guidance and Information Could Help Plan Participants at Home and Abroad Manage Their Retirement SavingsGAO-18-19: Published: Jan 31, 2018. Publicly Released: Mar 5, 2018.
Feb 21, 2018
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Railroad Retirement Board:
Actions Needed to Improve the Effectiveness and Oversight of Continuing Disability ReviewsGAO-18-287: Published: Feb 21, 2018. Publicly Released: Feb 21, 2018.
Jan 8, 2018
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Social Security Disability:
Additional Measures and Evaluation Needed to Enhance Accuracy and Consistency of Hearings DecisionsGAO-18-37: Published: Dec 7, 2017. Publicly Released: Jan 8, 2018.
Oct 18, 2017
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The Nation's Retirement System:
A Comprehensive Re-evaluation Is Needed to Better Promote Future Retirement SecurityGAO-18-111SP: Published: Oct 18, 2017. Publicly Released: Oct 18, 2017.
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