egtra catch up on 401(k) beg in 2002

[Guest dlm]

Is it true that the catch up for over age 50 participants is available even if the participant has had the maximum 402(g) limit in all prior plan years?

Seems odd that they are calling it a "catch up" if the participant can take advantage of this even if they've maxed 402(g) in the past.

Am i missing something or is this really available to anyone over age 50 regardless of prior contributions?

Thanks

DLM

[MGB]

The catch up is available to anyone that reaches a limitation in that one year (even a plan limitation like 10% of pay, or an ADP failure). Nothing from the past affects this.

The reference to "catch up" was because this was introduced as a "wife" provision. Presumably, women are more likely to have been out of the workforce for child upbringing. Although that is what the provision was targeted at, they will not be the ones that actually use it. In the end, it is just higher limits as you get older. If you were basing it on prior hitting of limits, there would be no way to integrate the information from before the person was an employee.

Note that the French have had this system for years. The amount of deductible contributions is based on your age.