401(k) Match Contribution Question

[Guest tgraham]

Highly comp employee over age of 50, makes $270,000. Employee defers $12,000 + $2,000 catch-up contribution. Employer's match is dollar-for-dollar up to 6% of wages. My feeling is the employer match is limited to 6% of $200,000, which is $12,000. There should not be a match of the $2,000 catch-up contribution.

Is that correct? Thanks.

[rcline46]

You cannot use wages above $200,000 for anything in a qualified plan for 2003. Therefore since the wage cut off is $200,000, the match cut-off is 6% of 200,00o or $12,000 anyway.

[Alf]

Another way to skin this cat is to verify whether the plan actually matches catch up contributions. It really depends on how the plan was written with catch ups were added, but I will go out on a limb and say that most employers do not (intend at least) to match catch ups.

[Mike Preston]

I disagree. In my experience, most employers match catch-ups. Not matching catch-ups is a pain to administer.