$170k Annunal Compensation Limits in Year End Testing

[Guest Jennifer M.]

My plan year was 4/1 to 3/31/02. For ADP/ACP testing should the salary limit be referring to the 2000 or 2001 limit? I know they are the same $170k. I think it should be 2001 and then next fiscal year end 3/31/03 the limit used in testing should be the 2002 limit of $200k. Is this correct? Same question for the elective deferral limit of $10,500 this time and $11k for next plan year end testing 3/31/03.

[rcline46]

Should be 2001 limit for compensation testing. However, the 10,500 / 11,000 deferral limit is really a calendar thingy.

So, if the participant could defer 11,000 from 1/1 to 3/31/02 and 10,500 from 4/1/01 to 12/31/01 they could have 21,500 in the test legally. Of course could only do a catchup the balance of 02 unless that also went in by 3/31/02!