Holding account earnings--Are they Annual Additions?

[jjaatirs]

If a plan sponsor deposits their profit sharing contribution into a holding account in the plan in installments throughout the year, are the earnings on that account considered to be Annual Additions for 415 when they are allocated to the participants? Specifically, there are several participants at the 415 limit already--can they get an allocation from the holding account earnings?

[WDIK]

Internal Revenue Code Section 415©(2):

(2) Annual addition

For purposes of paragraph (1), the term "annual addition" means the sum for any year of--

(A) employer contributions,

(B) the employee contributions, and

(c ) forfeitures.

For the purposes of this paragraph, employee contributions under subparagraph (B) are determined without regard to any rollover contributions (as defined in sections 402(c ), 403(a)(4), 403(b)(8), 408(d)(3), and 457(e)(16)) without regard to employee contributions to a simplified employee pension which are excludable from gross income under section 408(k)(6). Subparagraph (B) of paragraph (1) shall not apply to any contribution for medical benefits (within the meaning of section 419A(f)(2)) after separation from service which is treated as an annual addition.

It does not appear that the holding account earnings to which you refer are included in the definition provided in the IRC.