How do target benefit pension plans and money purchase pension plans compare?

The correct choice highlights that target benefit pension plans and money purchase pension plans share similarities in the way they handle contribution limits. Both types of plans are defined contribution plans, which means that the contributions to these plans are specified, while the actual benefits paid out at retirement may vary based on investment performance.

The "maximum annual addition limitations" refer to regulatory constraints on how much can be added to each participant’s account in any given year. In both target benefit and money purchase pension plans, these limits are indeed governed under the same Internal Revenue Code sections, ensuring consistency in the maximum contributions allowed for participants. This component provides an important aspect of planning for retirement savings, as both plan types encourage adequate funding while adhering to regulatory standards.

Highlighting their structural similarities and the shared regulatory framework enhances understanding of how different types of retirement plans operate in a consistent manner regarding contribution limits.