Guest tonjer Posted March 6, 2003 Posted March 6, 2003 Our plan's definition of compensation excludes bonuses. My understanding is that because the definition excludes bonuses, the plan must demonstrate that the definition does not discriminate in favor of highly compensated employees under 1.414(s)-1(d). First, is my understand correct? Secondly, what form is the plan required to file? Does the form have to be filed with the d letter application?
jaemmons Posted March 6, 2003 Posted March 6, 2003 Yes you are correct. You don't need to demonstrate this compliance to the IRS unless you submitting a plan document or plan termination for a DL. Even if you are submitting for only "form" opinion, the IRS review agent may still request a Demo 9 for the year of review.
AndyH Posted March 10, 2003 Posted March 10, 2003 tonjer, if the plan is general tested under 401(a)(4), there is no need for the 414(s) test, because the general test must use comp that complies with 414(s). So this is an alternative to 414(s) testing. And filing requirements, or lack thereof, are essentially the same.
alexa Posted March 13, 2003 Posted March 13, 2003 If the plan passes the 414(s) test, then I believe you can use Comp excluding bonuses in 401(a) (4) testing, correct?
Mike Preston Posted March 13, 2003 Posted March 13, 2003 Correct. Another tool in the arsenal against plan disqualification.
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