Annual additions crediting?

[jaemmons]

Client plan & fiscal years end 12/31/2003

They wish to make a profit sharing contribution in Feb '04 based on 12/31/2003 comp, but have it credited as a 2004 annual addition.

I believe the contribution is deemed to be an annual addition for 2003 because it is being allocated as of 12/31/2003. Does anyone see anything which would contradict this conclusion?

thanks

[pmacduff]

Do you mean 2004 and 2005, not 2003 and 2004? If so, what is the purpose of it being an '05 deductions but an '04 allocation? It wouldn't appear to make any sense....

[jaemmons]

This is for a plan being reviewed for 2003 testing. I don't know why the client wants to treat it as an annual addition for 2004, but I wanted confirmation that I am not overlooking something which would allow them to do so.

Make sense?

[pmacduff]

yep I think I see now - maybe the client didn't deduct it for 2003, so they want to deduct in 2004??....anyway...without more research, FWIW, I agree with you. If the allocation was done as of 2003 and used in 2003 testing and then deposited timely (before 03/15) I would say it's a 2003 annual addition. If they treated it as a 2004 annual addition, it would count for this year and 2003 testing would have to be "redone", right?