Common use of ACP Testing Limitations Clause in Contracts

ACP Testing Limitations. Employee contributions and Matching Contributions must meet the nondiscrimination requirements of Code Section 401(a)(4) and the ACP Test of Code Section 401(m). Safe Harbor Contributions are taken into account for a Plan Year under the ACP Test in accordance with Treasury Regulations Section 1.401(m)-1(b)(4)(ii)(A). If Employee contributions (including any Elective Deferrals recharacterized as Voluntary After-tax Contributions) or Matching Contributions are made in connection with a cash or deferred arrangement, the ACP Test is in addition to the ADP Test under Code Section 401(k). QMACs and QNECs used to satisfy the ADP Test may not be used to satisfy the ACP Test.