415 Testing of two plans with differing Limitation years

[Guest andmik]

I have a 401(k) and an ESOP plan of the same Employer. For 415 testing purposes, the ESOP has an Limitation Year of 10/1-9/30 (its Plan Year), while the 401(k) has a calendar year limitation year (its Plan Year).

Shouldn't these two plans be tested together, but with differing Limitation Years, not sure how to accomplish this smoothly, if at all.

Any feedback will certainly be appreciated.

Thank you,

Andmik

[MGB]

All plans of a controlled group must have the same limitation year. See 1.415-2(B)(1)(ii).

[Tom Poje]

you will have to do the following when calculating the 415 limit:

ESOP runs 10/1/99 - 9/30/00

Use that contribution plus the amount of deferrals made from 10/1/99 - 9/30/00. (It doesn't matter that the 401k is calendar)In other words, you use some deferrals from one plan year, and some from the other plan year.

you would also include the match and any ps contribution deposited in that time frame.

Then you have to run the 415 test on the 401k plan.

Plan year 1/1/00 - 12/31/00 and include any ESOP contribution made during that time period. That is probably the easy one to test.

[Guest RBeck]

MGB - it's not a controlled group - it's two plans of the same employer, which can have different limitation years.