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Term Details - f 401(k)

A retirement plan under section 401(k) of the Internal Revenue Code (IRC) that allows an employee to elect to have a portion of his/her compensation (otherwise payable in cash) contributed to a qualified retirement plan. The employee contribution is treated not as current income but most commonly as a pretax reduction in salary. The employer pays the employee contribution into the plan on behalf of the employee.

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Last Edited: December 3rd, 2010