Who is a highly compensated employee?
A highly compensated employee includes more than 5% owners and family members (see “Who is a Key Employee” above). An individual is highly compensated for 2009, if he earned more than $105,000 from the employer in 2008. For 2010, anyone who earns more than $110,000 in 2009 will be highly compensated. The test is a retrospective one. Check out the Annual Plan Limits section of this website for specific dollar amounts that apply to other years.
