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Educational Disclosure: This article provides general educational information only and is not financial, investment, legal, tax, employment, pension, or retirement advice. State Employee Advisor Network is a marketing and referral platform operated by Revenx LLC. It is not affiliated with the Maryland Supplemental Retirement Plans, Empower, the State of Maryland, or any Maryland public employer. Official plan documents, tax rules, employer records, and plan information control eligibility, contributions, investments, matching contributions, and distributions.
The State of Maryland offers voluntary supplemental retirement plans that eligible employees may use alongside other retirement benefits.
One option is the State of Maryland Savings and Investment Plan, commonly called the Maryland 401(k). It is a defined contribution plan, so its account value depends on contributions, investment gains or losses, fees, withdrawals, and other account activity.
This guide explains the plan’s general structure and the federal limits applying in 2026. It does not recommend whether an employee should enrol, how much to contribute, whether to use pre-tax or Roth contributions, or how the account should be invested.
The Maryland 401(k) is administered through the Maryland Supplemental Retirement Plans, or MSRP. MSRP is an independent State agency responsible for voluntary supplemental plans intended to complement, rather than replace, an employee’s primary pension or retirement programme.
Contributions are made through payroll deductions and allocated among investments available through the plan. Because it is a defined contribution account, its future value is not guaranteed.
MSRP’s current structure includes:
The MSRP 403(b) Plan was frozen to new contributions effective January 1, 2026. Existing balances remain subject to the applicable plan provisions, but the 403(b) should not be presented as a current new-contribution option.
State employees are generally eligible to participate in the Maryland 401(k), subject to current payroll and plan requirements. MSRP also confirms that contractual employees may enrol. Participation is voluntary.
Eligibility for the 401(k) does not automatically establish eligibility for the separate 401(a) matching contribution. Match eligibility may depend on employment classification, pension participation, qualifying contributions, and State budget provisions.
Participants may generally choose pre-tax contributions, Roth contributions, or a combination of both within the applicable annual limit.
Pre-tax contributions are generally deducted before federal and Maryland income taxes are calculated. Contributions and related earnings are generally taxable when distributed.
Roth 401(k) contributions are made after applicable income taxes. A qualified Roth distribution may be free from federal and Maryland income tax when the applicable five-year, age, and other requirements are satisfied.
A nonqualified Roth distribution may include taxable earnings. The availability of Roth contributions does not establish whether Roth treatment is appropriate for a particular employee.
For 2026, the federal elective-deferral limit for most 401(k) plans is $24,500.
When permitted by the plan and federal rules:
Individual limits can be affected by compensation, contributions to another employer plan, and other federal rules.
Beginning in 2026, federal rules generally require catch-up contributions to be made on a Roth basis when the participant’s prior-year wages from the plan sponsor exceeded $150,000. Employees affected by this requirement can confirm how it is being administered through MSRP and Empower.
MSRP states that the minimum contribution is generally $5 per biweekly pay period. The maximum election may be up to 100% of compensation, but it cannot exceed available compensation, payroll restrictions, or the applicable federal limit.
Eligible employees may participate in both the Maryland 401(k) and the governmental 457(b).
The 457(b) generally has a separate annual elective-deferral limit from the 401(k). In 2026, the standard federal limit is $24,500 for each plan, subject to eligibility, compensation, catch-up provisions, and other tax rules.
By contrast, employee deferrals made to multiple 401(k) and 403(b) plans generally share one annual elective-deferral limit.
This distinction does not determine whether contributing to one or both plans is appropriate for an individual employee.
The State provides a dollar-for-dollar match of eligible supplemental retirement contributions, up to $600 per fiscal year, when authorised by the State budget.
Qualifying employee contributions may include contributions to the MSRP 401(k) or 457(b). The State contribution is deposited into a separate 401(a) Match Plan account rather than directly into the employee’s 401(k).
Relevant information may include:
The match is not available to every employee and should not be treated as permanent or guaranteed beyond current State budget and plan provisions.
The plan’s investment menu may include:
Each option has different objectives, risks, expenses, and performance history. Account values can increase or decrease.
A target date does not guarantee that an account will provide sufficient retirement income. Current investment information, expenses, and quarterly performance reports are available through MSRP and the plan administrator.
A pension and the Maryland 401(k) operate under different structures.
An employee may participate in both arrangements, but this article does not recommend a contribution level or determine how the benefits should be coordinated.
Distribution rules depend on employment status, age, account type, and the reason for the withdrawal.
A Maryland 401(k) distribution may generally avoid the federal 10% additional tax when a qualifying condition applies, including:
A participant who separates earlier may be able to receive a distribution but could owe the additional federal tax unless an exception applies. Most taxable distributions are also subject to federal income-tax withholding. Roth distributions follow separate qualified-distribution rules.
Loans and hardship withdrawals may be available under the 401(k) plan’s provisions. The separate 401(a) Match Plan does not offer loans or hardship withdrawals. The governmental 457(b) has different early-distribution rules and should not be treated as identical to the 401(k).
Empower has served as MSRP’s plan administrator and recordkeeper since September 18, 2025.
Enrolment generally involves:
After enrolment, payroll deductions and account changes are handled through the current MSRP account platform and applicable employer procedures.
Organising this information does not determine which contribution, investment, loan, withdrawal, or rollover decision is appropriate.
State Employee Advisor Network is a marketing and referral platform operated by Revenx LLC. It is not affiliated with MSRP, Empower, the State of Maryland, or any Maryland public employer.
State Employee Advisor Network does not provide 401(k), investment, pension, retirement-planning, tax, or legal advice.
The platform may introduce eligible consumers to independent participating professionals. Any meeting, analysis, advice, recommendation, or service is provided solely by the independent professional.
State Employee Advisor Network receives compensation from participating professionals for marketing and referral services. This creates a financial incentive to make referrals.
Booking a consultation requests an introduction to an independent participating professional. The introduction is free to the consumer and does not mean State Employee Advisor Network has determined that a professional or service is suitable.
The State of Maryland 401(k) is a voluntary supplemental defined contribution plan for eligible State employees.
Relevant information includes contribution types, annual limits, matching eligibility, investment options, expenses, beneficiaries, distribution rules, and participation in other State retirement plans.
Account values are not guaranteed and may increase or decrease. Official MSRP plan documents, individual account records, and current tax guidance control.
This article does not recommend enrolment, a contribution amount, pre-tax or Roth treatment, an investment allocation, a loan, a withdrawal, or a rollover.
State employees are generally eligible to participate, including contractual employees, subject to current plan and payroll provisions.
The standard elective-deferral limit is $24,500. Eligible participants age 50 or older may contribute an additional $8,000. Participants turning age 60–63 during 2026 may qualify for the higher $11,250 catch-up.
Eligible employees may receive a dollar-for-dollar match of qualifying supplemental retirement contributions, up to $600 per fiscal year. The State contribution is deposited into a separate 401(a) account, and eligibility limitations apply.
Yes. Roth contributions are made after tax. Only qualified Roth distributions receive tax-free treatment.
Eligible employees may participate in both. The governmental 457(b) generally has a separate annual deferral limit from the 401(k), subject to current plan and federal rules.
No. It was frozen to new contributions effective January 1, 2026. Existing balances remain governed by the plan’s provisions.
No. State Employee Advisor Network is a marketing and referral platform. It is not affiliated with MSRP or the State of Maryland and does not provide investment, 401(k), pension, retirement-planning, tax, or legal advice.
Jeremy contributes regularly to State Employee Advisor Network. With a deep understanding of state pension systems and public-sector benefits, he offers readers insights and strategies to optimize their retirement outcomes.
State Employee Advisor Network is a marketing and referral platform operated by Revenx LLC. We connect consumers with independent, licensed financial professionals. We are not a registered investment adviser, broker-dealer, or insurance agency, and we do not provide investment, legal, or tax advice.
All financial services are provided solely by third-party professionals. Revenx LLC receives compensation from financial professionals for marketing and referral services, which may create a financial incentive to refer individuals to participating professionals. Users should independently evaluate any financial professional before engaging their services.
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