Grandfathered Governmental 401(k) Plan

[DTH]

There is not much information about grandfathered governmental 401(k) plans. A 457 governmental plan combines both the employee pre-tax and employer dollars for the 402(g) deferral limit. I assume that if the plan is a grandfathered governmental 401(k) plan that only the employee pre-tax dollars are counted towards the 402(g) limit. Does anyone have a cite or IRS procedure/Notice that states how these are treated.

Also, Form W-2 also does not mention how to treat grandfathered governmental 401(k) plans. I assume the employer would only report the employee pre-tax deferrals in Box 14 as Code D; employer contributions would not be reported at all. A 457 governmental plan would report both employee pre-tax and employer dollars as Code G.

[Locust]

A grandfathered govt 401k plan is just a 401k plan for reporting/402g purposes.

[DTH]

Just to make sure I understand your comment ... Grandfathered governmental 401(k) plans do not combine employer and employee contributions towards the 402(g) limit. Thus, for 2007 a participant can contribute $15,500 of employee pre-tax without adding in the employer contribution.

Thanks.

[J Simmons]

Just to make sure I understand your comment ... Grandfathered governmental 401(k) plans do not combine employer and employee contributions towards the 402(g) limit. Thus, for 2007 a participant can contribute $15,500 of employee pre-tax without adding in the employer contribution.

Thanks.

That's how I understand it. That's the significance of having a grandfathered 401k rather than being forced into the 457b peg.