Full Funding Credit and Maximum deductible

[Rick_G]

Originally Posted by actuary_scout

Just for your info, its ERISA FFL that is 800,000, the RPA FFL in this case in 0.

So we can by-pass the (150% CL-Assets) limit of 200K ; and upto 800,000 can be contributed as a deductible contribution. This is for 2007 plan year (1/1/07 - 12/31/07)

right?

Almost correct. Part of the contribution up to the ERISA FFL would be non-deductible. But they would be exempt from the excise tax.

The 404 deductible contribution would be the greater of
(1) 150% CL-Assets, and
(2) the lesser of

• the greater of the 412 minimum contribution or the 404 normal cost plus limit adjustments and
• the lesser of the RPA FFL and the ERISA FFL

I'm assuming there is only one plan. Otherwise things are a bit more complicated

[Samantha]

Originally Posted by actuary_scout

It seems a bit strange- can u help me understand the logic behind this. Thanks a lot.

Oh wait ... were you serious about that?

[Rick_G]

Samantha, You Funny!

[tymesup]

Note that for small plans, the 150% CL does not include the increase in benefits to HCEs due to a plan amendment in the last two years.