The 457 Deferred Compensation Plan allows Commonwealth of Massachusetts' employees to set aside a portion of earnings through a payroll deducation as an investment for retirement. The maximum contributions are defined by the IRS according to specific guidelines, including additional contributions if the individual is age 50 or older. The amounts contributed to the deferred compensation plan on the employee's behalf are not included in the employee's income for the purposes of federal and state income tax withholding, but they are subject to Medicare taxes.
The Office of the State Treasurer manages the Commonwealth's 457 Deferred Compensation SMART Plan. Great-West Retirement Services is currently the third-party administrator for the SMART Plan.
Board of Higher Education staff and campus employees may also contribute to a 403(b) tax-deferred annuity.