Per Pay Match Calulation - Cap Match?

[jeff77]

Have a plan that calculates their match on a per pay basis. Paid Monthly

Lets assume Joe Employee makes $84,000 per month and defers 401k of $1250.

Their Match formula is 100% up to 3%. My calculation shows Joe would get $1250 in match per month.

My question is do we have to cap his match to $7,950.00 (265000*.03) or does he get the full $15,000.00? More specifically with respect to tres reg 1.401(a)(17)-1(b)(3)(iii)(B)

[Mike Preston]

Cap it. The reg you cite says that you don't need to cap it based on pro-rata 265000. $265000 / 12 *.03 = $662.50 would be the pro-rata limit *if* it applied, but it doesn't. So $1,250 is ok as a match in the first six months with the balance of the annual limit of $450 as a match in the seventh month.

[K2retire]

Does the plan allow true ups for match?

[Mike Preston]

How does that impact the question posed if true? Or, if not true?