Prior Year Testing Method. Under the Prior Year Testing Method, the Average Deferral Percentage (“ADP”) of the Highly Compensated Employee Group (as defined in Section 17.7(e)) for the current Plan Year is compared with the ADP of the Nonhighly Compensated Employee Group (as defined in Section 17.7(f)) for the prior Plan Year. If the Employer elects to use the Prior Year Testing Method under Part 4F of the Agreement, the Plan must satisfy one of the following tests for each Plan Year:
(i) The ADP of the Highly Compensated Employee Group for the current Plan Year shall not exceed 1.25 times the ADP of the Nonhighly Compensated Employee Group for the prior Plan Year.
(ii) The ADP of the Highly Compensated Employee Group for the current Plan Year shall not exceed the percentage (whichever is less) determined by (A) adding 2 percentage points to the ADP of the Nonhighly Compensated Employee Group for the prior Plan Year or (B) multiplying the ADP of the Nonhighly Compensated Employee Group for the prior Plan Year by 2.
Prior Year Testing Method. The ADP for a Plan Year for Eligible Members who are Highly Compensated Employees for each Plan Year and the prior year’s ADP for Eligible Members who were Nonhighly Compensated Employees for the prior Plan Year must satisfy one of the following tests:
i) The ADP for a Plan Year for Eligible Members who are Highly Compensated Employees for the Plan Year shall not exceed the prior year’s ADP for Eligible Members who were Nonhighly Compensated Employees for the prior Plan Year multiplied by 1.25; or
ii) The ADP for a Plan Year for Eligible Members who are Highly Compensated Employees for the Plan Year: A shall not exceed the prior year’s ADP for Eligible Members who were Nonhighly Compensated Employees for the prior Plan Year multiplied by 2, and B the difference between such ADPs is not more than 2. If this is not a successor plan, for the first Plan Year the Plan permits any Member to make Elective Deferral Contributions, for purposes of the foregoing tests, the prior year’s Nonhighly Compensated Employees’ ADP shall be 3 percent, unless we have elected in Item K(2)(b)(i) to use the Plan Year’s ADP for these Eligible Members.
Prior Year Testing Method. The prior year ratio will be used for Plan Years beginning on or after . If this selection is made for the first year the Code Section 401(k) feature is added to this Plan (unless this Plan is a successor plan), then for the first Plan Year only, the amount taken into account as the ADP of Nonhighly Compensated Employees for the preceding Plan Year will be the greater of 3% or the actual percentage for the initial Plan Year:
1. [ ] N/A. (Effective date of prior year testing is after effective date of Code Section 401(k) feature.) 2. [ ] 3%.
Prior Year Testing Method. The “ADP” or “ACP” of Highly Compensated Employees for the Plan Year shall be compared to the “ADP” or “ACP” of Non-Highly Compensated Employees for the immediately preceding Plan Year. (Do not choose if Option 1.10(a)(1), alternative allocation formula for Qualified Nonelective Contributions.)
Prior Year Testing Method. The prior year ratio will be used for Plan Years beginning on or after
1. [ ] N/A. (Effective date of prior year testing is after effective date of Code Section 401(k) feature.) 2. [ ] 3%.
Prior Year Testing Method. Instead of the Current Year Testing Method, the Plan will use the Prior Year Testing Method in running the ADP Test. [Note: If the Plan is a Safe Harbor 401(k) Plan (as designated in AA §6C below), the Plan must use the Current Year Testing Method. Thus, for any year the Plan is a Safe Harbor 401(k) Plan, the Current Year Testing Method applies, regardless of any selection under this subsection.]
Prior Year Testing Method. Initial Plan Year ADP/ACP Suboption (a): 3 percent. NOTE: If no suboption is selected, Suboption (a) will apply. Option 2: Current-Year Testing Method.
Prior Year Testing Method. Paragraph 21.2
