dmb Posted November 11, 2003 Posted November 11, 2003 A 401k plan effective 1/1/03 was adopted 10/15/03. It is my understanding that compensation from the adoption date may be used for ADP testing. This plan has one owner and four or five NHCEs. Can I use comp from adoption date for the NHCEs and whole year comp for the HCE for ADP testing?? Thanks.
Blinky the 3-eyed Fish Posted November 11, 2003 Posted November 11, 2003 No. Your use of the compensation period would have to be consistent. By doing what you propose, you would artificially increase the NHCE's versus the HCE's. Just curious, but what gave you the idea that this would even be a possibility? "What's in the big salad?" "Big lettuce, big carrots, tomatoes like volleyballs."
dmb Posted November 11, 2003 Author Posted November 11, 2003 I was just wondering. It's really not going to make much of a difference, since I can use 3% ADP for the NHCEs in the first year.
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