What is required for an employee to qualify for a retirement benefit under a 403(b) plan?

To qualify for a retirement benefit under a 403(b) plan, an employee must work in a qualified public position. The 403(b) plan is designed specifically for employees of certain tax-exempt organizations and public educational institutions. This includes public school teachers, employees of public colleges and universities, and other non-profit organizations.

This requirement underscores the specific target audience of 403(b) plans, which do not apply to private sector employees or those functioning as statutory employees. By being aligned with public service roles, the 403(b) plan aims to provide retirement savings opportunities to employees dedicated to serving the public or working within non-profit sectors, rather than for-profit entities. Thus, having a qualified public position is a foundational criterion for eligibility in this retirement plan type.