457(b) Exempt from $45,000 Annual Limit ?

[RJM]

Hi All.... Have physician client who wants to max out retirement contribution at his C-Corp at $45,000 for 2007. Can he also defer the maximum $20,500 (for over-50) at his new hospital-employer's 457(b) plan without being considered over the $45k limit? It looks to me from the IRS publications that there is no mention of 457(b) being covered by this limitation, but does anyone know for sure? Thanks.

[New York Enrolled Agent]

I think you're good to go. The limitation on elective deferrals in §457 is NOT coordinated with the elective deferral limits in §402(g). §402(g)(3) gives the definition for elective deferrals (sum of deferrals from a 401k, SARSEP, 403b and SIMPLE) for purposes of that section and it does not include §457. §457(c) states the limitation on elective deferrals only in reference to section 457 itself.

[RJM]

Thanks much NYEA !

-Bob