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Allocation Formula for Classes of Employees


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that looks good.

I don't even think you need steps 3 and 4.

the 415 limit is probably covered elsewhere in the document.

step 3 only makes sense if HCEs at 160,000.

what if you want to give an hce 25% of pay (e.g. he only make 100,000.

also, it looks like next years comp limit will be 170,000. (If I understand how the limits increase according to the regulations)

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When drafting the allocation provisions for cross-tested ps plan is it necessary to include any allocation percentages in the plan document with respect to each class (or all classes, e.g., 3% allocation to insure top heavy test met)? I know the employer can provide the trustee written notification of the actual percentages to be allocated to each class. The percentages provided to the Trustee would of course be derived from cross-testing based on employee demographics.

Would it be enough to:

1) define each class of employees (Group A consists of all physician employees, Group B consists of all para-professional employees, Group C consists of all administrative employees, Group D consists of all employees not in Group A, B, or C.);

2) allocate within each group comp to comp;

3) limit total contribution to each participant to 18.75% of comp; and

4) limit allocation such that maximum annual addition under 415 is not exceeded??

Any comments or suggestions? Thanks in advance.....

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