Customizing settings for employee retirement catch-up contributions and limits

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Change to CS Support service hours

Our Support department is closed on Friday, April 28th for a company event. However, limited Accounting CS phone support is available on that date from 9 AM - 5 PM ET due to the approaching deadline for quarterly payroll tax forms.

Links to our most popular payroll tax processing topics are available in the Alerts and notices section on the right side of most pages.

Accounting CS handles cafeteria plan deductions, retirement plan deductions, and company matching amounts and automatically adjusts the annual limits for the various retirement plans.

When employees reach age 50, they are eligible to make increased (catch-up) contributions, and so as long as a birth date has been entered for an employee in the Birth date field in the Personal tab in the Setup > Employees screen, the application will automatically increase their annual contribution limit.

You can choose to specify how these limits are applied for your clients and their employees.

Requiring birth date information for employees with retirement plans

To make sure that the contribution limit is increased for all eligible employees, you have the option to require that a birth date be entered for any employees for whom a retirement plan deduction is set up.

  1. Choose Setup > Firm Information > Firm.
  2. In the Employee Requirements section of the Preferences tab of the Firm screen, mark the Require Birth date if active retirement plan deduction checkbox.

Excluding deduction items or employees from catch-up limit provisions

Some plans do not offer catch-up limits and some employees choose not to take advantage of catch-up limits or the opportunity to make additional contributions past the normal annual limit. The application provides a couple of ways to specify that increased catch-up limits should not apply for an employee regardless of their age.

At the client level, you can specify that the catch-up limit should not be applied to a specific deduction item for any employees by marking the Do not apply catch-up limit checkbox in the Limits section of the Main tab of the Setup > Payroll Items screen. The checkbox is available only for deduction item using a Special Type of Retirement/Cafeteria plan with 401(k), Roth 401(k), 403(b), Roth 403(b), 457 or Simple 408(p) selected.

At the employee level, you can specify that the catch-up limit should not be applied to a deduction item for a single employee by marking the Do not apply catch-up limit checkbox in the Limits section of the Main tab of the Employee Payroll Item Settings dialog (accessed by clicking the Ellipsis button next to the deduction item in the Deductions grid of the Payroll Items tab of the Setup > Employees screen). Marking and clearing the checkbox here at the employee level will override the client-level selection for this employee.

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