Defining the deduction code

  1. If the plan's contributions are calculated as a flat amount or a percent of salary, select the Amount subtab. Use these guidelines to specify the field values:
    Pretax

    If you select a pretax deduction for a defined contribution plan, then the deduction you select must have a tax status as described here: For 401(k) plans, the tax status must be 401(k). For 403(b) plans, the tax status must be 403(b). For 457 plans, the tax status must be 457.

    After-Tax

    If employees contribute a flat amount for this benefit on an after-tax basis, then select an after-tax deduction.

    Company

    If the plan contribution type is 1 to 5, then select a company deduction to track company contributions that are a flat amount.

    Company Match - Pretax

    If the plan contribution type is 6 or 7 and the company matches employee pretax contributions that are a flat amount, then select a company matching deduction.

    The tax status of the company match must equal the tax status of the corresponding employee deduction.

    Company Match - After-Tax

    If the plan contribution type is 6 or 7 and the company matches employee after-tax contributions that are a flat amount, then select a company matching deduction.

    Employee

    If this is a defined contribution plan and an employee's flat amount contributions switch from pretax to after-tax after the employee has met the 401(k) and 403(b) pretax limits, then select the deduction used for the employee's after limit contribution. If the Use AT Limit Deductions field in the Options tab of HR00.1 is No, then leave this field blank.

    Note: Deductions used for after limit contributions must be linked to the corresponding pre-tax deductions on Deductions (PR05.1).

    If using GHR Benefits, the above deduction information must be specified on DC Compensation Limits for GHR (BN12.3).

    To base a percent contribution on specific types of pay rather than all pay, assign a pay class to the deduction when you define the deduction in Deduction (PR05.1).

  2. If the plan's contributions are calculated as a flat percent, then select the Percent subtab. Use these guidelines to specify the field values:
    Pretax

    Select the pretax. If you are selecting a pretax deduction for a defined contribution plan, then the deduction that you select must have a tax status as described here: For 401(k) plans, the tax status must be 401(k). For 403(b) plans, the tax status must be 403(b). For 457 plans, the tax status must be 457.

    After-Tax

    If employees make percent contributions on an after-tax basis, then select an employee after-tax deduction.

    Leave this field blank for benefit plans under a flex plan.

    Company

    If the plan contribution type is 1 to 5, then select a company deduction to track company contributions that are a percentage of each employee's compensation. Leave this field blank for benefit plans under a flex plan.

    Company Match - Pretax

    If the plan contribution type is 6 or 7 and the company matches employee percent contributions made on a pretax basis, then select a company matching deduction.

    The tax status of the company match must equal the tax status of the corresponding employee deduction.

    Company Match - After-Tax

    If the plan contribution type is 6 or 7 and the company matches employee after-tax contributions that are a percent, then select a company matching deduction.

    The tax status of the company match must equal the tax status of the corresponding employee deduction.

    Employee

    If this is a defined contribution plan and an employee's percent contributions switch from pretax to after-tax after the employee has met the 401(k) and 403(b) pretax limits, then select the deduction used for the employee's after limit contribution. If the Use AT Rollover Deductions field in the Options tab of HR00.1 (Company) is No, then leave this field blank.

    Note: Deductions used for after limit contributions must be linked to the corresponding pre-tax deductions on Deductions (PR05.1).

    If using GHR Benefits, the above information must be specified on DC Compensation Limits for GHR (BN12.3).

  3. Select one of these tabs:
    If the plan is Then
    Reserve spending Select the Misc tab and select Reimbursement
    Saving Bond Select the Misc tab and specify the value and cost of the saving bond.
    EL or DL Select the Misc tab and select yes for Reportable Life if this plan should be included in the imputed income calculations (US Only).

    For Canadian Plans

    T4-RPP or DPSP

    		 Select Misc tab and specify the plan registration number.
  4. Select the Add form function. If you need to define covered compensation, vesting, or investment options for defined contribution or defined benefit plans, then see Additional options for defining benefit plans.