Defining Match Limit Schedules

This procedure enables you to define contribution limits for a plan in which employees contribute a percent or an amount that the company matches. You can limit the employee's pre-tax, after-tax, and total employee contribution as a percent of salary. The company match is calculated as a percentage of the employee's contribution. You can limit the percent of the employee's contribution that is matched. You can vary the match limit schedule based on years of service. If you do not want the match limit schedule varied by years of service, define only one range.

Note: If the plan does not have unique contributions for specific employee groups, you only need to define this form once for a plan by leaving the Employee Group field blank. If the plan has different contributions for different groups of employees, complete this form for each employee group for which contributions are unique. If you define multiple contribution records for one plan, you may choose to leave the employee group field blank on one of the records. The application applies the record with no employee group to all eligible employees who do not belong to the group(s) attached to the other record(s).

To define match limits schedules

  1. Access Benefit Plan (BN15.1).
  2. Select the Company, Benefit Type, and Plan for which you want to define a match limit schedule.
  3. Select Inquire function.
  4. Click the Contrib button. The Company, Benefit type, and Plan are already filled in when Match Limits Schedules (BN18.6) opens.
  5. Select the plan participants for the contribution record from the Coverage Type field.
  6. Type the start date for the contribution.
  7. If you are defining contributions that are unique to a particular group of employees, select the employee group for which this contribution applies.
    Note: If you choose to leave the group field blank, the application applies the record with no employee group to all eligible employees who do not belong to the group(s) attached to the other record(s).

    If you are defining contributions for COBRA participants, leave this field blank.

    Note: If you define contributions by employee group, make sure employee groups are defined such that an employee can be a member of only one group at a time. If an employee belongs to more than one group for which contributions have been defined, benefit entry programs and benefit update reports show the situation as an error.
  8. Define the Calculations section for this contribution using the following guidelines:
    Contribution Type

    Select whether employees can contribute as a percent, an amount, or either a percent or an amount.

    If the plan does not allow employee contributions, select No Employee Contrib.

    If you are defining contributions for COBRA participants, select Amount.

    Note: The calculation type selected must match the calculation type defined on the deduction codes that are attached to the plan.
    Contribution Tax Type

    Select whether the employee contributions are pretax, after-tax or both.

    If the plan does not allow for employee contributions, select No Employee Contribution.

    If you are defining contributions for COBRA participants and retirees, select After-Tax.

    Note: This must match with the deductions attached to the plan.
    Default Tax Type

    If employees can choose between pretax and after-tax contributions and you want a tax type to default on benefit entry forms, select the contribution tax type that you want as the default. You can override the default contribution tax type on benefit entry forms.

    If you selected Pretax or After-Tax in the Contrib Tax Type field and you leave this field blank, this field defaults to the value in the Contrib Tax Type field.

    Increments

    Type the percent increment employees can contribute to the plan. For example, if you type one, employees can make contributions of one percent, two percent, three percent and so on, within the other limits of the schedule. If you type 0.5, employees can make contributions of 0.5%, one percent, 1.5% and so on.

    Match Option

    Select if you want your company to match contributions as pretax, after-tax or both.

    From Date

    Select the date from which you want the application to begin calculating each employee's years of service. If your schedule does not vary based on years of service, select Hire Date or Adjusted Hire Date.

    The values of this field are from Employee (HR11.1).

    Service Date

    Select the date you want the application to determine each employee's years of service.

    As of Date and Year

    Type the date you want to use to determine an employee's years of service for coverage calculations.

    • If you selected As of Date in the Date field, type the month and day.

    • If you leave the Year field blank when you use the As of Date, the application calculates an employee's years of service on the latest month and day specified.

    • If you type a Year, the employee's years of service are determined on the exact month, day, and year you specify.

  9. If the Contribution Type is Amount, define the salary section for this contribution. Use the following guidelines to enter field values:
    Type

    Select the type of salary you want to use for the contribution calculation. Leave this field blank if the contribution type is percent.

    Date

    Select the date you want the application to calculate each employee's salary.

    As Date and Year

    Type the date you want to use to determine an employee's salary for contribution calculations.

    • If you selected As of Date in the Date field, type the month and day.

    • If you leave the Year field blank when you use the As of Date, the application calculates an employee's salary on the latest month and day specified.

    • If you type a Year, the employee's salary is determined on the exact month, day, and year you specify.

    • If an employee does not have a salary history for the date specified, the application uses the current salary.

    Minimum and Maximum

    Type the minimum and maximum salary amounts for calculating contributions. If an employee's salary is either less or greater than these amounts, the application uses these amounts to calculate the contribution for the employee.

    Method

    This is a required field. If you don't want the application to use any rounding methods, select No Rounding.

  10. Click the Schedule button. The Match Limits (BN19.3) form opens. Define the employee, company, and company match contributions with limits based on a service schedule.
  11. Select the Add function.

Related Reports and Inquiries

To Use
List benefit plan information Plan Parameter Listing (BN215)
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