What happens to my agency matching contributions when the annual limit has been reached?
If you are a FERS employee, your agency matching contributions are also suspended when the annual limit on elective deferrals has been reached. Agency matching contributions are based upon the amount of employee contributions that you make each pay period. If there are no employee contributions in a pay period, there can be no agency matching contributions.
If you are a FERS employee, your Agency Matching Contributions are also suspended when the annual limit on elective deferrals has been reached. Agency Matching Contributions are based upon the amount of employee contributions that you make each pay period. If there are no employee contributions in a pay period, there can be no Agency Matching Contributions. So because the matching is done per pay period and not for the whole year, reaching the maximum $15,000 before the end of the year and last pay period would result in the loss of the 5% matching for each of the remaining pay periods. You should take note as well that for 2005 the last pay period of the tax year was PP 24 NOT PP 25 or 26, which are the first two pay periods of tax year 2006. Also, because of these changes, as one officer put it, the designation of a percentage contribution may be a “trap” for a large number of you earning more than $100,000 and at risk of reaching the $15,000 limit too soon. The USDOC cable emphasize
Related Questions
- How should we track in-kind matching contributions? For instance, a partner agency allocates staff time to the project what should we have on hand in the event of an audit?
- What happens to my agency automatic (1%) contributions when my employee contributions and agency matching contributions are suspended?
- What happens to my agency matching contributions when the annual limit has been reached?
