Common use of Salary Reduction Agreements Clause in Contracts

Salary Reduction Agreements. Under Option (j), the Employer must make selections from (1), (2), (3) and (4). Under (1), Option (ii) prescribes a maximum deferral percentage, Option (iii) prescribes a minimum deferral percentage and Option (i) prescribes no special maximum limitation. The Employer may select both Options (ii) and (iii), or both Options (i) and (iii), but Options (i) and (ii) are mutually exclusive. The Employer may wish to consider a maximum percentage deferral under Option (ii) to minimize the potential for Code 415 violations. Under paragraphs (2) and (3), the Employer elects which restrictions apply to the participant's right to revoke his/her salary reduction agreement. Under paragraph (4), the Employer elects which restrictions apply to the participant's right to increase or decrease his/her salary reduction percentage. The Employer should consider the effect its elections have on plan administration.

Salary Reduction Agreements. Under Option (jk), the Employer must make selections from (1), (292), (3) and (4). Under (1), Option (ii) prescribes a maximum deferral percentage, Option (iii) prescribes a minimum deferral percentage and Option (i) prescribes no special maximum limitation. The Employer may select both Options (ii) and (iii), or both Options (i) and (iii), but Options (i) and (ii) are mutually exclusive. The Employer may wish to consider a maximum percentage deferral under Option (ii) to minimize the potential for Code 415 violations. Under paragraphs (2) and (3), the Employer elects which restrictions apply to the participant's right to revoke his/her salary reduction agreement. Under paragraph (4), the Employer elects which restrictions apply to the participant's right to increase or decrease his/her salary reduction percentage. The Employer should consider the effect its elections have on plan administration.