I'm looking to see how others are handling the following:
The plan sponsor has a 401(k) Plan that provides a match formula equal to of 100% of the first 6% contributed. The contributions are deposited semi-monthly. Assuming the HCE has not received the maximum match allocation of $17,100 (6% of $285,000) at the time the compensation reaches the $285,000 limit, would the HCE be entitled to additional match allocations on deferral contributions for compensation earned over the $285,000 limit. The plan has no true-up provision and the document defines the match determination period as "each payroll period" and not "the Plan Year". Some people say the match allocation must stop when the compensation reaches to $285,000 limit. Others say the match allocation can continue (up to the plan formula maximum) on compensation in excess of the $285,000 as long as there are corresponding deferral contributions.
Should the match allocations stop or should they continue?
