How Is The 401K Match Calculated When The 401a and 402g Limits Are Met? (Doc ID 1482040.1)

Last updated on MARCH 04, 2025

Applies to:

Goal

How is the employer match calculated for when the 401a and 402g Savings Plan Limits are met where the employee deduction is not limited to the 401a limit and the employer match is not limited to the 402g limit?

Configuration example:

Service Step table:
Up to 3% of employee earnings: 100% match.
Up to 5% of employee earnings: 50% match.

Limit Table:

- 402g limit includes employee deductions, Before Tax,  but not employer match deductions
- 401a Limit includes employer match deductions, NonTaxable Btax Benefits, but not employee deductions

Employee Details:

- 401 special accumulator for the paycheck = 47,500
- Earnings left before hitting 401a Limit = $40,045.46
- Employee deduction 8% before tax = 1,312.57, 2487.43 = 402g limit not taken
- Employer match NonTaxable Btax Benefits = 1256.96

Solution

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