Is it possible to have too many classes of employees in a cross-tested

[Guest dflin]

Does anyone have any thoughts on the maximum number of employee classes in a ct ps plan? For example, a 250-employee medical practice wishes to create a plan with 15 classes of employees, one class for each profit center (profit centers are radiology, oncology, etc.) Each class would consist of about 15-20 employees, and each class would receive varying rates of ps contributions. Does this sound unreasonable?

[Guest]

Not unreasonable, but it might be a pain to administer.

I have seen one plan with each doctor in his own class.

In some ways your example it is no different than having 15 separate plans and then combining them all for nondiscrimination testing as required by the regs. you know you can do that, so having one plan with different classes is not much different, except you only have 1 5500.

[MR]

I agree with Tom Poje. One thing I'll add - when your client wants to know how much you're going to charge to administer that monster you had better be careful. Imagine the possible combinations of contribution rates for the various profit centers!

[Guest dflin]

Thanks Tom and MR.