Jump to content

ADP test for SARSEP


FJR
 Share

Recommended Posts

Don't know SARSEPS, but does the ADP test for these plan run similar to qualified plans. For example

1. Is compensation capped at 200,000 for average deferral

2. Can compensation for test be net of deferal

Also,

when allocating a employer contribution, is it allocated net of deferals or is it gross comp?

Thanks.

Link to comment
Share on other sites

I haven't done one of those in a while. If my memory serves me correctly, I believe every HCE has to be tested separately and the 2+/2% spread is not available. In other words each HCE's deferral percentage must be no higher than 1.25% above the NHCE ADP.

Link to comment
Share on other sites

Yes, each HCE is limited to 1.25 X the NHCE average.

There's also a 50% participation requirement.

Comp is capped at $200,000, as indexed. It'll be defined in the plan document and would most likely include deferrals, for testing or allocation purposes.

Ed Snyder

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
 Share

×
×
  • Create New...