What type of contribution is not permitted in a money purchase pension plan?

In a money purchase pension plan, contributions must adhere to specific tax treatment and regulatory guidelines. One of the defining features of these plans is that they are primarily funded through employer contributions made on behalf of the employees, generally reflecting a set percentage of the employee's compensation.

The correct response indicates that before-tax contributions, which are typically employee deferrals made into plans such as a 401(k), are not allowed in a money purchase pension plan. This aligns with the plan's structure, as it does not permit employee pre-tax contributions but rather mandates employer contributions that are tax-deferred for the employee.

Rollover contributions, employer matching contributions, and post-tax contributions can be permitted within certain contexts of a money purchase pension plan. For instance, rollover contributions can occur when an individual transfers funds from another retirement plan, and employer matching contributions may be integrated into the plan structure to incentivize participation or savings. Post-tax contributions might also be made under certain circumstances, depending on the specifics of the plan design.

Thus, the prohibition of before-tax contributions in a money purchase pension plan is rooted in how these plans are structured and administered, focusing solely on employer-funded contributions rather than allowing employees to defer parts of their salary on a pre-tax basis.