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Conference nyoss1::market_investing

Title:	Market Investing

Moderator:	2155::michaud

Created:	Thu Jan 23 1992
Last Modified:	Thu Jun 05 1997
Last Successful Update:	Fri Jun 06 1997
Number of topics:	1060
Total number of notes:	10477

922.0. "401k "fairness" and suspension of contributions?" by STRWRS::KOCH_P (It never hurts to ask...) Tue Oct 10 1995 12:46

    
    It's approaching the end of the year. I was just re-reading about 401k
    plans and remembered about the "fairness" test where highly compensated
    employees affect how much can be contributed to the plan. So, given
    this, when do we find out if the company must suspend contributions to
    the plan? Are they actively monitoring compliance on a week to week
    basis? Or do they simply calculate it at some time in December and
    "refund" our tax free contributions making them taxable income?
    
    Is there a note on how this works?

T.R	Title	User	Personal Name	Date	Lines
922.1		CADSYS::RITCHIE	Elaine Kokernak Ritchie, 225-4199	`Tue Oct 10 1995 15:06`	3
	Sounds like something to look for in DIGITAL_INVESTING Elaine
922.2		PADC::KOLLING	Karen	`Tue Oct 10 1995 16:38`	3
	Wrong conference, but in the interests of speed:they track this and suspend contributions.
922.3	Wrong time of the year for that Mar-Jul	SSDEVO::RMCLEAN		`Tue Oct 10 1995 18:00`	1
	And that is usually done in March or so not this time of the year.
922.4	what about the different contribution rates?	GUIDUK::BRENNAN_CA	Cathy Brennan, 548-8563	`Tue Oct 10 1995 19:04`	8
	Since this conversation doesn't seem to be moving... I thought the different contribution maxima (8% vs 12% if I remember correctly) got around this problem. Why would there still be a suspension period if highly compensated folk can only contribute at a lower rate? Cathy