New DB Plan with Jan 2 - Jan 1 Plan Year?

[David MacLennan]

Just wondering if anyone has, or is considering, setting up new DB plans with a Jan 2 - Jan 1 Plan Year in order to take advantage of the EGTRRA $ limit increases.

[david rigby]

At this late date?

I would think that the nuisance of having a plan year begin on January 2 would be more trouble than it's worth. But it's a fair question.

[Guest Ray Williams]

A 2/1 to 1/31 plan year does the same thing, but is much less confusing to admin. We already had several plans with that plan year, and may put in more.

[Guest datalife]

I agree that you can run a plan from 2/1 - 1/31. How about if you have a short first Plan Year and then change to a calendar year thereafter. 2/1 - 12/31, 1/1 - 12/31. I have a concern about future legislation that will require implementation for a limitation years ending in X. Does anyone have any opinion. Am I off base? Thanks

[david rigby]

Sure you can have a short plan first plan year. But the point of the original post was that certain EGTRRA changes are effective for plan years ending in 2002, so a short year that ends 12/31/2001 does nothing to take advantage of this.