Employer Match on "Catch-Up" Contribution?

[Guest glhotdog]

Has there been any discussion regarding the application of Employer Match to the "Catch-UP" contributions authorized in EGTRRA? Some promotional information from some benefit/HR firms, have indicated that this is something employers should investigate. Any thoughts regarding how this will affect testing?

[rcline46]

We need regs, and they aren't out yet, so we are guessing!

I would say NO because match is based on deferrals. In most cases match cuts out before ees get to 11000 anyway.

[MWeddell]

$11,000 / $200,000 = 5.5%, so for employees earning near or above the new 401(a)(17) pay cap in plans that match the first 6% of deferrals or more, a decision to match catch-up contributions will affect some employees. Still, the negative impact on ACP tests will probably be slight, and will tend to be more than offset by EGTRRA changes that favorably impact the ACP test, namely the raise in the 401(a)(17) pay cap and the elimination of the multiple use limit.