Funding 401(h) Account

[Guest chicago]

Has anyone considered this:

If an employee purchases service credit in a d/b plan with a rollover from an eligible retirement plan can 25% of the employee contribution be used to fund a 401(h) account?

[Guest Steve C]

I don't think you can do it. At first I was getting hung up on whether the subordination rule was based on 25% of total 'ee + 'er contributions, or just the employer portion. Then I remembered that the last line of 401(h) tells us to ignore contributions that are made to fund past service credits.

- Steve