SEP/401(k) combined limits

[steve-o]

What are the deferral limits for a person over age 50 who was in a SEP for the first 6 months of 2003 and then moved to a 401(k) plan effective July 1?

Is it the $12,000 plus $2,000 catchup for the 401(k) or must that limit be prorated along with the SEP limits?

[mbozek]

If the SEP and 401(k) are not maintained by employers in the same controlled group or group under IRC 414(m) then there are separate 415 limits for the contributions to each plan. The employee has a $2000 catch up election to the 401(k) plan for a maximum elective contribution of $14,000 since pre tax contributions are not permitted to a SEP. (Only SARSEPS established prior to 1/1/97 are eligible for elective contributions which are aggregated with the elective contributions & catch up to the 401(k) plan. The employee contributions to both plans are aggregated and any amount over the 402(g) limit is allocated to the catch up to a maximum of $2000.)