Schedule T clarification

[Guest ypartridge]

Let's say I have a plan with PS, 401(k) and 401(m); 100% benefit on the 401(k) and 401(m), but less than 100% benefit on the PS side. I'm not clear as to how to complete page 2.

What if I have a PS only, and less than 100% benefit?

[bzorc]

The way I have been doing it is as follows:

For the 3 benefit structures, I do one full set of numbers (total ee's, out for service, etc.), usually the profit sharing. Then in the next set of lines, I list the 401(k) and match, and show the percentage as 100%.

For one structure, I follow the beginning procedure, marking that the plan passes by using the ratio percentage test.

Hope this helps.

[Richard Anderson]

For the one that uses the full set of numbers I have been using the one with the lowest ratio; sometimes that is the PS, sometimes match.

If the 401(a) part uses the average benefit test; but, 401(k) and 401(m) parts pass the ratio test, I mark 4f that the plan satisfies coverage by the average benefits test.

[Kristina]

The IRS has directed me that Items 4c and 4d were to be completed for the non-elective portion, even if there were no profit sharing contribution for the plan year. The 401k and 401m portions are reported in Item 4e as the disaggregated portions.

If you mark the average benefits test, better make sure you have the documentation in the file that the plan passes the average benefits test.