Steve Waddo

Thanks Kevin.

We are consulting on a 403(b) plan that has had an ADP test run (and refunds processed) for the past several years. Anyone have any thoughts about a correction method? Thanks.

Plan provides for a 3% non-safe harbor match. Participant must be employed on the last day of the quarter to be eligible for the allocation. Also, plan provides for a quarterly true-up. The question is how should the true-up be calculated with this design? Should the true-up only be calculated for the quarter in which a deferral is made or should the compensation for quarters where no match is contributed also be considered for a true-up? The individually designed document is silent. Example: First quarter Joe has compensation of $40,000 and contributes $17,500. Match contribution is $1,200. Second quarter Joe has compensation of $40,000 and no deferral/match. Should a true-up be calculated on $80,000? What if he terminates during second quarter therefore making him ineligible for the match since he was not employed on the last day of the quarter? Is that a game changer? Any insight would be greatly appreciated!

But what about the different plan year ends?

Thanks for the reply. The plans want to be tested separately since they have different rates of match. How are the able to substantiate that they can pass coverage on their own?

I have two plans that are a controlled group - however the plans have different plan year ends (one is 5/31 and the other is 6/30). How are these plans handled for testing? Thanks.