Retirement plan, designed specifically for public school and other local or state public employees, in which employees can make contributions (or elective deferrals) to the plan on a pretax basis. Employers can also make contributions to the plan on behalf of the employee. The maximum combined amount that can be contributed by the employee and employer is 20% which is also subject to a dollar amount cap. The 403(b) Plan is similar to the 401(k) Plan. Other employees eligible for this type of plan are those employed by nonprofit, scientific, religious or charitable organizations.