Post Severance comp for Allocations

[austin3515]

The final 415 regs go on ad nauseum about how post severance comp cannot be included for 415 comp definition. I'm looking for the connection that it can't be used for benefit accruals, such as 401k deductions?

I know that it cannot, but where does it say there is a connection between the two?

So what is to stop me from making post-severance comp eligible for allocations, and then using a 415/414s compliant definition for nondiscrimination testing? I know there is something, but again, what is that something?

[austin3515]

1.401(k)-1(e)(8)

(8) Section 415 compensation required. With respect to compensation that is paid (or would have been paid but for a cash or deferred election) in plan years beginning on or after July 1, 2007, a cash or deferred arrangement satisfies this paragraph (e) only if cash or deferred elections can only be made with respect to amounts that are compensation within the meaning of section 415©(3) and § 1.415©-2. Thus, for example, the arrangement is not a qualified cash or deferred arrangement if an eligible employee who is not in qualified military service (as that term is defined in section 414(u)) and who is not permanently and totally disabled (as defined in section 22(e)(3)) can make a cash or deferred election with respect to an amount paid after severance from employment, unless the amount is paid by the later of 21/2 months after severance from employment or the end of the year that includes the date of severance from employment and is described in § 1.415©-2(e)(3)(ii) or (iii).

But then again, this does leave the door open for recognizing otherwise non415 compensation for profit sharing as long as I can pass testing on a 414s/415 compliant definition.