What Makes A Retirement Plan Qualified? 
Generally speaking , a qualified retirement plan is one legislated by the government with tax advantaged features to attract American workers to save for retirement . One example is The Employee Retirement Income Security act of 1974 -LRB- ERISA -RRB- that addresses defined benefit and defined contribution plans . And one of the most popular employer sponsored defined contribution retirement plans is a 401 -LRB- k -RRB- . Plan participants can make pretax contributions that accumulate tax deferred and some employers match a portion of the employee 's contribution . Of course distributions at retirement are taxed as ordinary income and there are penalties for distributions before age 59 1/2 . 