FAQ 60: ADP--QNEC flat dollar amount


How do I code a flat dollar amount QNEC in ASC?


The ADP test does not have a flat dollar amount QNEC that it determines to pass the test. However, you can code a flat dollar amount in the plan specs, and then run the test including the QNEC source to see if it passes. I would start with a dollar amount equal to the prorata amount, to get an idea of whether or not the flat dollar option would be cheaper or more expensive.

To code it, go to the QNEC source spec screen and set the Force Contribution field to "No-Use Valuation Calcs". Then input the total QNEC amount under the "Show Total Contrb." button. Next, select "1-All Even" for the Contribution Allocation Method. Under the "Show Parameters" button, select non-HCEs only to receive the QNEC. Run valuation calculations and then re-run the ADP test including this source.