Term
Cash or Deferred Arrangement (CODA) |
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Definition
| An arrangement that involves an election by an employee between receiving compensation in cash or having compensation deferred to a qualified plan. |
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Term
Qualified CODA / 401(k) Arrangement |
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Definition
| Refers to the cash or deferred arrangement in a qualified plan. |
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Term
| 401(k) Arrangement / Qualified CODA |
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Definition
Refers to the cash or deferred arrangement in a qualified plan |
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Term
| Salary Reduction Agreement |
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Definition
The employee agrees to reduce compensation in exchange for the deferral. |
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Term
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Definition
| Contribution made to a qualified plan under CODA (cash or deferred arrangement) |
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Term
| One-Time Irrevocable Election Rule |
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Definition
| Not a cash or deferred arrangement (CODA). If the election is irrevocable, and is made no later than the time the employee first becomes eligible for any plan maintained by the employer |
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Term
| Pre-ERISA Money Purchase Plan |
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Definition
| Plan that was in existence on June 27, 1974 and otherwise satisfies the definition of a pre-ERISA Money Purchase Plan prescribed by IRC 401(k)(6) - requires the plan to limit employer and employee contributions to levels available in 1974 |
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Term
| Designated Roth Contribution |
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Definition
| Special type of elective deferral because they are made with after-tax dollars. |
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Term
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Definition
| May be made in a 401(k) Plan, Simple 401(k), 403(b), SARSEP, Simple IRA, or 457 Plan. Deferrals that are in excess of various otherwise applicable limits. ($5,000 in 2009) |
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Term
| Catch-up Eligible Participant |
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Definition
| Participant that is 50 years old or older or will turn 50 years old by the end of the calendar year. |
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Term
| After-Tax Employee Contributions |
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Definition
| Contributions that are made after taxes. Contributions that are considered to be annual additions under the 415 that are subject to the 415 limitations that are the lesser of 100% of compensation or $46,000 in 2008. (may change due to cost of living adjustments) They are subject to nondiscrimination testing, ACP testing |
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Term
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Definition
| Employer contributions that are made on account of elective deferrals or after-tax employee contributions. |
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Term
| Nonelective Contributions |
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Definition
| Employer contributions to a qualified plan that are not elective deferrals made under the 401(k) arrangement and are not matching contributions. |
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Term
Qualified Matching Constributions (QMAC) |
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Definition
If a QNEC Qualified Nonelective contribution is allocated in proporation to elective deferrals it constitutes a matching contribution. |
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Term
Qualified Nonelective Contribution (QNEC) |
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Definition
| Contribution that is made by an employer that is 100% vested when made and subject to the same distribution limitations as elective deferrals. Used to pass the ADP and ACP tests |
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Term
| Constructive Receipt Principles |
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Definition
| If a taxpayer is in control of whether to receive taxable compensation or have it deferred. |
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Term
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Definition
| The plan provides that as of the plan entry date when the employee is first eligible for the 401(k) plan, the employee is automatically enrolled at a default salary deferrals rate. |
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Term
| Negative Election or Negative Enrollment |
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Definition
| The employee need to fill out a form to elect against automatic enrollment. |
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Term
Elgible Automatic Contribution Arrangement (EACA) |
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Definition
Elective deferral arrangement that: - has option to defer cash to have employer make contributions to the plan -participant treated as made deferral in an uniform % amount until they elect not to or change election -in absence of investment election auot enrolls according to DOL regs. -notice requirements of IRC 414w4 are satisfied |
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Term
Qualified Automatic Contribution Arrangement (QACA) |
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Definition
| is an eligible automatic contribution arrangement (EACA) that satisifies addtional requirments |
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Term
Qualified Default Investment Arrangement |
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Definition
| Under the PPA if a trustee selects a default fund that meets certain requirements, the default fund will have protection under ERISA 404(c) equialvent to that available when participants select their own funds. |
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Term
| IRC 401(a) Limit / 402(g) Dollar Limit |
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Definition
| IRC 401(a)(30) limits the amount of elective deferrals that employee may make to a 401(k) plan in any calendar year. This limit is the dollar amount under the 401(g) |
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Term
| IRC 402(g) Dollar Limit / IRC 401(a)(30) Limit |
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Definition
| IRC 401(a)(30) limits the amount of elective deferrals that an employee may make to a 401(k) plan in any calendar year. This limit is the dollar amount under the 402(g) |
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Term
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Definition
| Individuals elective deferrals exceed the IRC 402(g) dollar limit |
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Term
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Definition
| Elective Deferrals are part of the annual addtions that are limited by the IRC 415. The 415(C) limit on annual addtions is generally the lesser of 100% of compensation or the dollar limit in effect under the IRC 415(c)(1)(a) for the year. |
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Term
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Definition
| 401(k) plan that limits the % that an employee may contribute |
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Term
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Definition
The ADP test prescribes a maximum average deferral rate for a group of HCE's who are eligible for the 401(k) arrangement for the plan year |
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Term
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Definition
| Earnings for the period form the last day of the calendar year in which the excess deferrals arose to the date of the actual distributions. |
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Term
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Definition
| Allocable earnings in which the excess deferrals arose..can be positive (gains on excess deferrals) or negative (loss on excess deferrals) |
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Term
| Uninversal Availability Test |
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Definition
| Plan is treated as failing to satisfiy IRC 401(a)(4) unless all catch-up eligible pariticipants have the same election rights available to them with respect to catch-up contributions |
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Term
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Definition
| Catch-up eligible must be notified of his or her right to make these contributions |
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Term
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Definition
| Make up the difference between the match already funded and the employer matching contributions to which the pariticpant is entitled under the formula. |
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Term
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Definition
| Determines how the contributions described in the contribution formula will be allocated amoung the participants acounts |
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Term
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Definition
| The plan defines the formula to be used by the employer to determine the amount of the non-elective contributions only |
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Term
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Definition
| A distribution made at the employees election of all contributions made by the automatic enrollment on behalf of the employee. Must be requested in the first 90 days of participation |
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