This program calculates the best integration level for a tax-qualified profit-sharing plan, from the perspective of one or more "favored" employees. Typically the corporation sponsoring the plan will wish to favor the employee who owns the corporation (for example, a physician who owns a professional medical association that employs the physician, a nurse and one or more office staff).
It allocates a proposed employer contribution amount among the accounts of the eligible employees using many different integration levels, in order to find the integration level that results in the greatest share of the employer's contribution being allocated to the account of the "favored" employee (which is why the program is called the "Inte-Greater").
A profit-sharing plan's integration level is set by the terms of the plan document when the plan is created. This program can be helpful in deciding how to write the plan document, by using some assumed compensation and eligibility information for the first plan year. It is possible to change an existing plan's integration level by amending the plan document, but it is wise to obtain legal advice before attempting to do so. (For example, it is illegal to amend a plan to "cut back" the amount of an allocation to which any particular employee has become become entitled under the pre-amendment plan document.)
This program does not determine whether a different kind of defined contribution formula (e.g., a "cross-tested" plan) or a defined benefit plan would achieve an even better result for the favored employees.
This program assumes the plan is sponsored by a corporation (not a sole proprietorship or partnership). It is more difficult to perform these calculations for self-employed individuals (see, for example, IRS Publication 560). A software application that can find the optimal integration level for a plan sponsored by a sole proprietorship or partnership is attorney Gary Lesser's QP-SEP Illustrator.