Which church 403(b) plans are subject to the nondiscrimination testing requirements of the Code?
A-7: Only church 403(b) plans maintained by employers that are not classified as a Church or a Qualified Church-Controlled Organization (QCCO) are subject to the nondiscrimination testing requirements of the Code. Therefore, the determination of an entity’s status as a Church or a QCCO is a critical determination. Code section 3121(w)(3)(A) defines the term “church” to mean “… a church, a convention or association of churches, or an elementary or secondary school which is controlled, operated, or principally supported by a church or by a convention or association of churches.” Thus, 403(b) plans maintained by an entity traditionally viewed as a church, and elementary and secondary schools controlled, operated or principally supported by such an entity, are not subject to the nondiscrimination testing requirements of the Code. Code section 3121(w)(3)(B) defines the term “qualified church-controlled organization” to mean “any church-controlled tax-exempt organization described in secti
