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Former Member

Final 401K Deduction of the Year

Hello All,

We are having a problem with the last 401K deduction of the year for employees who are very close to the maximum limit. In fact, the full deduction would put these employees over the max.

We are on ERP 2004 (ECC 5.0), bi-weekly pay period.

For Example:

The YTD for pay period 26 (before pay is run) is 44,615.75.

The class limit for 2007 is 45,000.

The employee is contributing $334.62 in after tax, $1,115.39

in supplemental, and the company is matching $334.62.

When pay period 26 is run, the supplemental contribution is reduced to $0.

The employee contribution reduced to $49.63

The employer contribution reduced to $49.63

Since this is the last pay period of the year our <i><b>desired</b></i> results are:

a) We want the supplemental contribution to be reduced to $0. This

is working.

b) We want the system to recognize that this is the last pay

period of the year and to allow the employee to reach the $45,000 limit

by reducing the employee contribution to 192.12 and calculating the

company match at 192.13.

Can anyone point me in the right direction to get the desired results?

Thanks in advance,

Marlo

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1 Answer

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    Former Member
    Posted on Aug 30, 2007 at 08:53 PM

    Marlo

    Did you ever get an answer to this question?

    I'm trying to set this up in my system and I'm getting the same results as you. But because it is not on the last pay period the following pay period it reduces employee contribution to zero and then reduces the employer match to a lower amount. However, when it recalculates the employer match later it does not change it, hence the employee receives an employer match and has no employee contribution. This error will create problems with our non-discrimination testing.

    Renny

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    • Former Member Former Member

      Renny,

      Have you heard anything yet on this issue? I'm a colleague of Marlo's and have been getting questioned about it. If you do have an update, I'd appreciate anything you have.

      Thanks,

      Myron