W-2 Contribution Cont. %
NHCE $12,480.00 $268.00 2.15%
NHCE $44,325.00 $953.00 2.15%
HCE $210,000.00 $13,339.00 6.35%
HCE $6,510.00 $140.00 2.15%


I was asked to review a plan with the above contributions and contribution perecntages for 2005 plan year. Plan is and was TOP HEAVY as far back as I was provided data - 2002. Plan passed the required tests, and is using the 3/1 gateway.

Seems like the NHCE's should have received a 3% contribution, or have I missed something here.

Bill

based on data provided, I would agree, plan needs to provide top heavy minimum

Unlikely, but is the HCE receiving 6.35% a non-key?

"Unlikely, but is the HCE receiving 6.35% a non-key?"

NO. It's a dental practice, and he's the dentist. Sole proprietor. 100% owner.

I'm glad I'm not the TPA for 2005. Thanks Tom and BT3EF.

Bill

Were you engaged to review only 2005? How far back does the problem exist?

"How far back does the problem exist?"

No problems with 2002, 03, or 04. I have not seen any data prior to 2002, but the plan was ammended to a cross-tested plan in 2002.

What is the proper way to correct the 2005 allocation?
1. Reallocate the 2005 contribution (with corrected reports to participants) or, 2. do a make up contribution in 2006?

Bill

Unless the assets were in earmarked accounts with individual investment direction, I would just re-allocate.

If the assets were already given to the individuals to invest, I would ask for more contribution.