Are there any special exceptions to the amounts that employees are permitted to contribute?
Yes. Generally “Highly Compensated Employees” are not permitted to contribute to the plan in an amount that is more than 1.25% of the amount of the other employees. This amount is determined as an average based on the contributions as a percentage of compensation. For example, the “highly compensated employees” average contribution rate cannot be above 10% if the other employees’ rate is 8% (8% x 1.
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