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Cross-testing for Short Plan Year


chris

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Will change of Profit Sharing Plan's plan year, which will result in a short plan year, have any effect on the allocation of the employer's contribution on a cross-tested basis????

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The cross-tested allocation doesn't necessarily change, but I can think of a couple things to keep in mind:

(1) If the plan is aggregated with others for testing purposes, changing the plan year of some but not all of the plans can mess up your testing situation.

(2) If you are also changing the 415 limitation year, be aware that unexpected problems can arise when that happens.

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