Cross Tested Contributions under 410(b)

[Hoard1]

Is there a distinction of which contributions that are used in cross testing a plan under 410(B) and 410(a)(4) ie Profit Sharing, 401(4), Match QNEC QMAC & Safe Harbor. Any cites would also be helpful.

Thanks.

JTS

[This message has been edited by Dave Baker (edited 12-15-1999).]

[Guest Fred Reilly]

Mandatory disaggregation rules of 1.410(B)-7© apply. See1.401(a)(4)-1©(4).

[Guest]

my original response was 'zapped' somehow, so I will try again.

safe harbor contributions can be used to satisfy other nondiscrim tests: see VIII B of notice 98-52

for QNECs I will use the example bound in the ERISA Outline Book

"QNECs are included in the average benefit ratio. [i'm sure there is no argument there] For purposes of calculating the rate groups...the test must be satisfied when the profit sharing contributions are tested alone, and ALSO when the QNECs are added to the profit sharing contribution. See tres reg 1.401(k)-1(B)(5)

Since QNECS usually only go to NHCEs, then if you pass the test without using the QNECs, you will pass using them. however, if some HCES received a QNEC, then you must do the rate group tesrt twice!

[John A]

Tom, We have a 3-ring binder for which updates are sent periodically that is entitled "ERIAS OUTLINES PPD Pension Library." Is this resource the same as or related to Sal Tripodi's "The ERISA Outline Book?" Have you seen both? Would you be willing to explain any differences between them? I was considering ordering the ERISA Outline book, but now I'm wondering if we really already have it. (Sorry to be off the topic of this thread). Thanks.

[Guest]

I have not seen the PPD book.

The ERISA outline book is revised every year, though of course that doesn't mean you have to buy a new copy every year.

The examples are fantastic, and I must admit it sure has helped me a lot. you probably notice I will cite it from time to time.

The book is put out by ASPA.

the last few years they have included a coupon for a price reduction on c-1 or c-2 test. I have seen a number of questions posed on Benefits link in which the book provided an answer, or at least confirmation / reg cite for something you knew, but didn't know where to look.