Has anyone figured out how to let an employee continue with their 401k percentage contribution past the IRS limit, but NOT match on the catch-up contribution amount? We currently do it manually where the employee has to hit the $18,000 limit, then we switch them to a dollar amount contribution via a paper form that is manually entered on BN32.1.
For example, employee contributes 10% of their salary, and hits the $18,000 contribution max in September. They then turn in a form to have us continue with the catch-up contribution in a dollar amount on their next check. Their deduction is then changed from a percentage to a dollar amount until the end of the year because we do not match on the catch-up contribution. This dollar amount deduction code is set-up not to match on that code. Then at the end of the year, we change them back to their percentage so they can receive the match again in the new year.
We are looking to let these employees continue their percentage into their catch-up contribution, but only match on the first $18,000 until the match limit is reached.
Any ideas?
How does your plan read on the employer match? Do you match up to a certain % or $ amount? Then what is your Contribution Type on your benefit plan?
If you use Match Limit Schedule, you can contribute a matching % up to a given % contributed by the employee and then apply a $ cap to that. As the employee is reaching their annual maximum (pre-catchup), you will need to have BSI set up for the increased contribution limit and the corresponding BSI Group identified on the employee's record.