IRS Notice 2007-28 Q&A 9

Assuming the DB contribution exceeds 25% of compensation, in an owners-only DB/DC situation, is the maximum total deductible contribution for 2009 equal to:

1. the maximum DB deductible under 404(o), plus $16,500 employee deferral, plus $5,500 catch-up (if possible), plus 6% employer match, or

2. the minimum required DB contribution (but not less than the 430(c)(4) Funding Shortfall), plus $16,500, plus $5,500, plus 6%?

If the answer is 2, is the normal approach to eliminate the 6% match, so that the total maximum is the maximum DB deductible under 404(o), plus $16,500, plus $5,500?

Choice 1 is your answer.

It was in the Solomon letter in summer of 2007 and WRERA finalized it.

Thanks, SoCalActuary! It's right there in Section 108(c) of WRERA! Excellent!

Wouldn't your DB contribution be limited to the greater of a minimum required contribution or an excess of Funding Target over Plan Asset (i.e. no 50% cushion and no normal cost)?

Start with the determination that the DC contribution does not exceed 6% of eligible payroll for the DC plan.
If that is true, ignore the entire DC contribution, and proceed on the DB funding as if it stood alone.

Sorry, I misred the original post as "Assuming the DC contribution...". So, just to confirm, if DC contribution is over 6%, then DB contribution is limited to the greater of a minimum required contribution or an excess of Funding Target over Plan Asset (i.e. no 50% cushion and no normal cost). Correct?

Calavera, that's what it looks like to me.

However, you cannot forget about the 25% combined plan limit if not a PBGC covered plan. And, the first 6% of the DC is "free", so you are really looking at 31% of pay.