§ 1.401(m)-1Employee and matching contributions.
(a) General rules.
(1) Nondiscriminatory amount of contributions.
(2) Other nondiscrimination rules.
(3) Rules applicable to collectively bargained plans.
(b) Actual contribution percentage test.
(1) General rule.
(2) Plan provision requirement.
(3) Aggregation of plans.
(i) General rule.
(ii) Restructuring and Permissive Disaggregation.
(4) Employee and matching contributions taken into account under the actual contribution percentage test.
(i) Employee contributions.
(A) General rule.
(B) Recharacterized elective contributions.
(ii) Matching contributions.
(A) General rule.
(B) Matching contributions and qualified nonelective contributions used to satisfy actual deferral percentage test.
(C) Treatment of forfeited matching contributions.
(5) Qualified nonelective contributions and elective contributions that may be taken into account under the actual contribution percentage test.
(c) Additional requirements.
(1) Coordination with other plans.
(2) Recordkeeping requirement.
(3) Consistent application of separate line of business rules.
(d) Examples.
(e) Correction of excess aggregate contributions.
(1) General rule.
(i) Permissible correction methods.
(ii) Combination of correction methods.
(iii) Impermissible correction methods.
(iv) Partial correction.
(2) Amount of excess aggregate contributions.
(i) General rule.
(ii) Coordination with correction of excess contributions.
(iii) Correction of family members.
(3) Corrective distribution of excess aggregate contributions (and income).
(i) General rule.
(ii) Income allocable to excess aggregate contributions.
(A) General rule.
(B) Method of allocating income.
(C) Alternative method of allocating income.
(D) Safe harbor method of allocating gap period income.
(E) Allocable income for recharacterized elective contributions.
(iii) No employee or spousal consent required.
(iv) Treatment of corrective distributions and forfeited contributions as employer contributions.
(v) Tax treatment of corrective distributions.
(A) General rule.
(B) Rule for de minimis distributions.
(C) Rule for certain 1987 and 1988 excess aggregate contributions.
(vi) No reduction of required minimum distribution.
(vii) No corrective distribution of matching contributions other than excess aggregate contributions.
(4) Coordination with section 401(a)(4).
(5) Failure to correct.
(i) Failure to correct within 21/2 months after end of plan year.
(ii) Failure to correct within 12 months after end of plan year.
(6) Examples.
(f) Definitions.
(1) Actual contribution percentage.
(i) General rule.
(ii) Actual contribution ratio.
(A) General rule.
(B) Highly compensated employee eligible under more than one plan.
(C) Employees subject to family aggregation rules.
(1) Aggregation of employee contributions and other amounts.
(2) Effect on actual contribution percentage of nonhighly compensated employees.
(3) Multiple family groups.
(2) Compensation.
(3) Elective contributions.
(4) Eligible employee.
(i) General.
(ii) Certain one-time elections.
(5) Employee.
(6) Employee contributions.
(7) Employer.
(8) Excess aggregate contributions.
(9) Excess contributions.
(10) Excess deferrals.
(11) Highly compensated employee.
(12) Matching contributions.
(i) In general.
(ii) Employer contributions made on account of employee or elective contributions.
(iii) Contributions used to meet the requirements of section 416.
(13) Nonelective contributions.
(14) Plan.
(15) Qualified nonelective contributions.
(16) Section 401(k) plan.
(17) Section 401(m) plan.
(g) Effective dates.
(1) General rule.
(2) Collectively bargained plans.
(3) Certain annuity contracts.
(4) State and local government plans.
(5) Transition rule for plan years beginning before 1992.
(i) General rule.
(ii) Restructuring.
(A) General rule.
(B) Identification of component plans.
(1) Minimum coverage requirement.
(2) Commonality requirement.
§ 1.401(m)-2Multiple Use of alternative limitation.
(a) In general.
(b) General rule for determination of multiple use.
(1) In general.
(2) Alternative limitation.
(3) Aggregate limit.
(i) In general.
(ii) Relevant actual deferral percentage and relevant actual contribution percentage defined.
(iii) Examples.
(c) Correction of multiple use.
(1) In general.
(2) Treatment of required reduction.
(3) Required reduction.
(4) Examples.
(d) Effective date.
(1) General rule.
(2) Transition rule.