Law Firm Plan Non Discrimination Testing

[Gary]

A large law firm provided our firm plan data in order to perform non discrimination testing for their plan for the most recent completed plan year.

The law firm has 50 partners.

The data has a field for each partner entitled "Gross Compensation". While they call it gross compensation, my inclination is to presume that this is Schedule K1 net earned income since they are partners.

Furthermore, the partners each have $30,500 contributed to their profit sharing plan for the plan year ending 3/31/08.

Of the $31,500 a portion of such amount is paid by the partner (I presume out of their K1 income) and a portion is paid by "the firm".

Since my understanding of a partnership retirement plan is that the employer makes deductible contributions for the employees and contributions on behalf of the partners is derived from their k1 income, it would follow that the so called "firm contribution" would simply be an additional amount of k1 income for the partner to applpy to the profit sharing plan.

Any opinions out there on my above analysis of the compensation and profit sharing contribution data in connection with these partners?

Thanks.

[Mike Preston]

I think you need to go back to the source and ask. They might already have taken what you are going to take into account into account thereby making inappropriate for you to take it into accunt, since they have already taken it into account.

[Andy the Actuary]

I think you need to go back to the source and ask. They might already have taken what you are going to take into account into account thereby making inappropriate for you to take it into accunt, since they have already taken it into account.

I thought Mike was an actuary and not an account-ant?