Leaderboard

my friend Jackie Gleason said to pass on this info to Norton: the following example is from the IRS website. I think it is safe to assume deferrals were made during the year and profit sharing was made after the end of the year. basically, 1. sum everything up a person received. 2. ooops, over the 415 limit 3. treat overage as a catch up https://www.irs.gov/retirement-plans/401k-plan-catch-up-contribution-eligibility Example - IRC Section 415(c) limit. Susan is a participant in a 401(k) plan that permits catch-up contributions. She is age 54 and is a catch-up eligible participant. Elective deferrals to the plan are permitted up to the IRC Section 401(a)(30) limit ($18,500 for 2018). The plan provides for a matching contribution equal to 25% of her elective deferrals. The plan also permits discretionary profit sharing contributions that are allocated pursuant to a predetermined formula set forth in the plan. Susan’s compensation for 2018 is $200,000. She deferred $18,500 to the plan. Her matching contribution is $4,625. She receives a discretionary profit sharing contribution in the amount of $35,000. Susan’s total allocation ($18,500 plus $4,625 plus $35,000) exceeds the dollar limitation on annual additions under IRC Section 415(c) by $3,125 ($58,125 less $55,000 is $3,125). The plan treats $3,125 of Susan’s elective deferrals as catch-up contributions.

If I have full year's comp I find it easiest to ask them for comp thru 6/30 and then subtract it. That (6/30) report is probably already available somewhere...it's surprising/disturbing how difficult it is for some people to provide 7/1-12/31 figures but easy to get it as of 6/30.

You subtract out the deferrals before applying the 401(a)(17) limit.