Prevailing Wage and Quarterly Match

[Guest Tbrown]

I have a plan that uses the prevailing wage contributions to offset the safe harbor match. The match is calculated and deposited quarterly (the basis in the plan document is quarterly). The prevailing wage deposits are used to offset it each quarter. We are trying to determine if the prevailing wage amounts can be carried forward from quarter to quarter. For example:

Participant A

1st quarter match $500

1st quarter PW $800

--------

Net Match Deposit $0

2nd quarter match $500

2nd quarter PW $250

------

Net Match Deposit $250

If you combine the first 2 quarters contributions, you would have:

Match $1,000

Prevailing Wage $1,050

----------

Net Match Deposit $0

The client wants to be able to carry forward the prevailing wage contributions that exceed the quarterly match. Does anyone know if this can be done? I can see where this could be troubling based on the fact that the match must be deposited by the end of the next quarter.

Tim

[GBurns]

What do you mean by "uses ..... to offset.." ?

I thought that the contributions are employee contributions that are immediately and fully vested.

[Guest Tbrown]

What do you mean by "uses ..... to offset.." ?

I thought that the contributions are employee contributions that are immediately and fully vested.

You are allowed to use the Pension Fringe portion of the prevailing wage to offset the employer contributions made to the plan (with some restrictions). This is similar to the health care fringe.....you can use it to offset the cost of premiums for the plan being provided by the employer. They are fully vested contributions.