401k Plans Deferrals and matching when compensation …

Employer matching contributions. If your plan provides for matching contributions, you must follow the plan’s match formula. Example: Your plan requires a match of 50% on salary deferrals that do not exceed 5% of compensation. Although Mary earned $360,000, your plan can only use up to $275,000 of her compensation when applying the matching …

https://www.irs.gov/retirement-plans/401k-plans-deferrals-and-matching-when-compensation-exceeds-the-annual-limit