austin3515 Posted May 7, 2020 Posted May 7, 2020 There is no maximum auto escalate number on an EACA like there is on a QACA, is that right? So I could auto escalate to 20% if I wanted to? Austin Powers, CPA, QPA, ERPA
Luke Bailey Posted May 8, 2020 Posted May 8, 2020 austin3515, if you are talking about an EACA under Code sec. 414(w) (and not just an ACA), your annual increases have to be based on the number of years the participant has been subject to the arrangement (see Treas. reg. 1.414(w)-1(b)(2)(ii)), but the step minimums and 15% cap that apply to QACAs are not applicable, so yes, you could get to 20% ultimately. Luke Bailey Senior Counsel Clark Hill PLC 214-651-4572 (O) | LBailey@clarkhill.com 2600 Dallas Parkway Suite 600 Frisco, TX 75034
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