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I have a plan that is a 6/30 year end. For this plan, there is 1 participant that always has 401k reclassed as catch-up to avoid refunds. This has not been an issue in prior year, because he never actually contributed catch-up - his 401k for the plan year and calendar year was less than the maximum 401k. For the period 1/1/24 - 6/30/24, he contributed $15,000 and we had to reclass $2,500 as catch-up to avoid refunds. Does this necessarily limit how much we should have limited his 7/1/24-12/31/24 contributions? Is he limited to $12,500 for 7/1/24-12/31/24? If he contributed $15,000, is a refund fo excess deferrals required?
