Benefit Guaranty Corporation (PBGC) for defined contribution plans, but cash balance plans do get such insurance because they, like all ERISA-defined benefit plans, are covered by the PBGC. Plans may also be either employer-provided or individual plans. Most types of retirement plans are employer-provided, though individual retirement accounts (IRAs) are very common. Tax advantages Most retirement plans (the exception being most non qualified plans) offer significant tax advantages. Most commonly the money contributed to the account is not taxed as income to the employee at the time of the contribution. In the case of employer provided plans, however, the employer is able to receive a tax deduction for the amount contributed as if it were regular employee compensation. This is known as pre-tax contributions, and the amounts allowed to be contributed vary significantly among various plan types. The other significant advantage is that the assets in the plan are allowed to grow through investing without the taxpayer being taxed on the annual growth year by year. Once the money is withdrawn it is taxed fully as income for the year of the withdrawal. There are many restrictions on contributions, especially with 401(k) and defined benefit plans. The restrictions are designed to make sure that highly compensated employees do not gain too much tax advantage at the expense of lesser paid employees. Currently two types of plan, the Roth IRA and the Roth 401(k), offer tax advantages that are essentially reversed from most retirement plans. Contributions to Roth IRAs and Roth 401(k)s must be made with money that has been taxed as income. After meeting the various restrictions, withdrawals from the account are received by the taxpayer tax-free. EGTRRA and later changes The Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) brought significant changes to retirement plans, generally easing restrictions on the ability of the taxpayer to roll money from one type of account to the other, and increasing contributions limits. Most of the changes were designed to phase in over a period of 4 to 10 years. History of pensions in the United States 1717: The Presbyterian Church creates a Fund for Pious Uses to provide for retired ministers. 1884: Baltimore and Ohio Railroad establishes the first pension plan by a major employer, allowing workers at age 65 who had worked for the railroad for at least 10 years to retire and receive benefits ranging from 20 to