Code Section 401 A 17

An em ployee is a section 401 a 17 employee as of a date on or after the statutory effective date if the employee s cur rent accrued benefit as of that date is based on compensation for a year prior to the statutory effective date that ex ceeded the annual compensation limit for the first plan year beginning on or after the statutory effective date.

Code section 401 a 17. The maximum annual compensation that may be taken into account for benefit computation purposes by a qualified plan is the 401 a 17 limit. Under internal revenue code section 414 d a governmental plan is an irc section 401 a retirement plan established and main review government plans under internal revenue code section 401 a who the plans cover the types of plans and information updates. Code section 401 a 17 establishes compensation limits for a variety of tax purposes.

The limit under irc section 401 a 17 is not prorated for the first plan year because the compensation measurement period under the plan is 12 months. Example 4 plan termination plan b is a profit sharing plan with a calendar plan year. The plan sponsor adopts a resolution to terminate the plan effective september 30 2018.