Employer contribution limits and timing

[BG5150]

Since 403(b) plan Employers generally don't file tax returns, is there a 404(a) limit to what the Employer can contribute?  Is it the same a for-profit companies, 25% of pay?

And when are the ER contributions due, since there is no tax form deadline?  12/31 the following year? (assuming calendar year)

Is any of this discussed in the regs?  Where?

[CuseFan]

My understanding is such employers have no 404(a) limit on their contributions to retirement plans, which has been discussed previously in this forum. I remember administering a 401k plan for a very generous larger employer that provided employer contributions in excess of 17% of payroll (pre-EGTRRA, when PS limit was 404(a) limit was 15%).

However, tax-exempt employers do file informational returns (990's) and I believe their contribution timing is tied to those for purposes of employer contributions being considered for 415 purposes for the respective year. I remember looking this up ages ago but do not remember where I found it (maybe 415 regs, I'll take a look, unless someone else finds out sooner).

[CuseFan]

10/15 for calendar year plans. Cut & pasted 1.415(c)-1(b)(6) below:

(B) Date of employer contributions. For purposes of this paragraph (b), employer contributions are not treated as credited to a participant's account for a particular limitation year unless the contributions are actually made to the plan no later than 30 days after the end of the period described in section 404(a)(6) applicable to the taxable year with or within which the particular limitation year ends. If, however, contributions are made by an employer exempt from Federal income tax (including a governmental employer), the contributions must be made to the plan no later than the 15th day of the tenth calendar month following the end of the calendar year or fiscal year (as applicable, depending on the basis on which the employer keeps its books) with or within which the particular limitation year ends. If contributions are made to a plan after the end of the period during which contributions can be made and treated as credited to a participant's account for a particular limitation year, allocations attributable to those contributions are treated as credited to the participant's account for the limitation year during which those contributions are made.

[Peter Gulia]

CuseFan has the information right.

I can think of two situations in which Internal Revenue Code § 404 might be relevant:

A charitable organization has some activities that result in unrelated business taxable income. Such a charity might want a § 404 deduction for the portion of retirement plan contributions allocated to the business that produces the UBTI.

An employer—considering everything that counts together as one employer under IRC § 414(b)-(c)-(m)-(n)-(o)—includes not only charities and other exempt organizations but also taxable organizations. Contributions for employees of a taxable organization would be to a plan other than a § 403(b) plan.

There can be accounting and tax-allocation issues when compensation of executives or physicians who perform services used by several charitable, tax-exempt, and taxable organizations of an employer is allocated to the organizations.