401(a) clarification

[Guest IRaceTA]

The IRS allows participants with less than a year of service and 18 years old to be taken off the ADP/ACP testing regardless of the eligibility requirements of the plan.

Does this year of service look at the anniversary year of the participant in question or the plan year for testing? Where can I find that clarified?

[Tom Poje]

I think this is my '2000' posting on benefits link. what a waste of my time over the years!

Therefore, I will list the code cite and force you to look it up or beg, borrow and steal from someone else to post the exact wording

look at 410(a)(3) of the code

[No Name]

I go to the exteme and assume plan cold be written such that age 21 and one year of service required. Once completed, plan could have semi annual entry dates, so entry is the next semi annual entry date.

[Guest IRaceTA]

For testing purposes I found that to exclude anyone with less than a year of service this means that the year of service is as of the end of the PRIOR calendar year.

Is this correct? So that means that a terminated participant in the current year testing has to be INcluded if they had a year of service as of the end of the prior calendar year.

[rcline46]

If you are using software to do this, contact your software provider for an explanation of how it is done in their software. It does vary by vendor.

If you are doing it by hand, review the methodology in Sal Tripodi's ERISA OUTLINE BOOK.

Also read the Code as noted by Tom, and the regulations. Then document your interpretation and do it.