Treatment of deferrals in excess of 402(g) limit ($10,000 in 1999) in

[Guest PLHart]

When running ADP Test, are deferrals that participants made in excess of 402(g) limit ($10,000 in 1999) counted, or do you only count the deferrals up to the 402(g) limit? Our client had several participants who exceeded $10,000 last year. Corrective distributions were made earlier this year, however, we need to confirm treatment in ADP test.

[Disco Stu]

For HCEs, amounts contributed in excess of the 402(g) limit are included in the ADP test. For NHCEs those amounts are not included.

I don't have a cite handy, but I'm sure you'll find it somewhere in 401(k).

[MR]

It is also likely that you'll find it in your plan document. Buried in the deferral language is often a reference to the limit and how and excess is handled. Disco Stu's synopsis is correct.