If employer limits elective deferrals ......

[Guest Moe Howard2]

Iv'e read that the IRS released final regs on catch-up contributions on 07/07/03.

I've also read that those regs say that if the employer wants to set a plan limit on elective deferrals.... then such limits must be expressly provided for in the "PLAN DOCUMENT" and or adoption agreement.

Here's the situation:

1) The adoption agreement says that elective deferrals are limited to 10%.

2) The adoption agreement says that catch-up contributions are allowed, but makes no mention of any $amount limitation or % limitation for such catch-up.

Let's say a participant's gross annual compensation is $25,000. He elects the max 10% deferral = $2,500. He is age 53.

My Question:

Can the employer prevent him from deferring an additional $3,000 and calling it "catch-up contribution" ?

[Archimage]

Based on what you have said, he should be able to defer the full catchup amount.

[k man]

archimage is correct. he can defer the full amount of the catch up due to the employer imposed plan limit.