Full plan year but deferrals start 10/1

A new plan is effective 1/1.....However, the plan sponsors did not get it all set up until later.  Deferrals started 10/1.   Do they have to  pro-rate either the deferral limit or catch-up.  I don't th ink so , but have seen conflicting opinions.  What about compensation?   I am thinking they use just 10/1 through 12/31?  actual compensation? 

The Code Section 402(g) limit on the amount of elective deferrals and the annual limit on the amount of catch-up contributions are calendar year, not plan year, limits.  Even if you had a short plan year, they are not prorated.

In the 401(a)(17) compensation limit regulations, the fact that contributions are made each pay period can be ignored when deciding whether proration is needed, but you are using just 3 months' worth of compensation to compute contributions to the 401(k) and 401(m) portions of the plan.  So, yes, the compensation limit needs to be multiplied by 3 months divided by 12 months for those portions of the plan.  If you have an employer nonelective contribution being made, the compensation limit does not need to be prorated for that contribution source.

Just one additional reminder.... Look at the plan document.  

PNJ