Nonallocation Year definition
Examples of Nonallocation Year in a sentence
The Nonallocation Year Attribution Rules apply for purposes of determining ownership.
An Impermissible Allocation also occurs in a Nonallocation Year if a Disqualified Person accrues additional benefits, directly or indirectly, under the Plan or any other qualified plan of the Employer that would have been allocated to the Plan account of the Disqualified Person for the Nonallocation Year and invested in Employer Stock consisting of stock in an S corporation owned by the Plan, but for a Plan provision that precludes such allocation and investment.
For any Plan Year in which the Trust Fund holds Stock consisting of stock in an S corporation, no portion of the assets of the Plan attributable to (or allocable in lieu of) such Stock may, during a Nonallocation Year, accrue (or be allocated directly or indirectly under any plan of the Employer meeting the requirements of Section 401(a) of the Code) for the benefit of any Disqualified Person.
As of each Valuation Date or as of such other dates as determined by the Committee and prior to any allocation of Company Stock to be made as of such date, the Committee shall determine whether an allocation of Company Stock may cause a Nonallocation Year to occur or cause any Participant to become a Disqualified Person in the current or following Plan Year, as set forth in Article 5.
If necessary to prevent a Nonallocation Year as described in Section 4.12(a), the Plan Administrator will transfer the minimum number of shares of Employer Stock from the ESOP accounts of Disqualified Persons to the Non-ESOP accounts of those persons that will result in Disqualified Persons owning 49% of the sum of the outstanding shares of stock in the S Corporation (including Deemed-Owned Shares) and the Synthetic Equity Shares owned by Disqualified Persons.
In a Nonallocation Year, an Impermissible Allocation occurs if any annual addition (as described in Section 5.9 of the Plan) is made to the Plan account of a Disqualified Person.
The only adjustment to basis was $29,902 for depreciation (straight line method under MACRS over the 39-year recovery period for nonresidential real property).
An Impermissible Allocation also occurs in a Nonallocation Year if a Disqualified Person accrues additional benefits, directly or indirectly, under the Plan or any other qualified plan of the Employer that would have been allocated to the Plan account of the Disqualified Person for the Nonallocation Year and invested) in Employer Stock consisting of stock in an S corporation owned by the Plan, but for a Plan provision that precludes such allocation and investment.
No portion of the assets of the Plan attributable to (or allocable in lieu of) Employer Stock consisting of stock in an S corporation may, during a Nonallocation Year (as defined in 6.11(d)), accrue (or be allocated directly or indirectly under any plan of the Employer meeting the requirements of Code §401(a)) as set forth in Code §409(p) and the regulations thereunder, for the benefit of any Disqualified Person.
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