match true-up

[cpc0506]

Plan doucment was restated with match calculated on a Plan Year Basis. In the past, the client made the match on a pay period basis. We informed client that additional funds were due to plan for 2012.

Client wants to amend plan back to pay period basis effective 1/1/2013. Can this be done now? The plan has no allocation requirements for receiving a match.

[ETA Consulting LLC]

As a rule, you cannot change the conditions for receiving an allocation after those conditions have been met. With that said, each participant is entitled to a 'true-up' match based on Compensation received (and deferrals made) through the current date. You can amend today, to a payroll period match (and calculate a true-up through today) and move forward in the manner in which the employer desires.

Good Luck!

[John Feldt ERPA CPC QPA]

You may want to confirm just how discretionary that match is (as defined under the terms of the document). I have seen a document where the time-period was allowed to be a discretionary annual determination made by the employer.

edit: wording

[ETA Consulting LLC]

You may want to confirm just how discretionary that match is (as defined under the terms of the document). I have seen a document where the time-period was allowed to be a discretionary annual determination made by the employer.

edit: wording

I've never seen that one. Wouldn't doubt it as the industry has come a long way in diluting the meaning of "definitely determinable formula" over the past 20 years. I always thought the foundation of a definite determination would be the 'time period' for which the contribution is being calculated. Again, I wouldn't doubt it; but seeing this would be a first for me.

Good Luck!