| FAQ 61: ADP--First year 3% not working |
We have a plan where the 401(k) feature was just added in 2003 and we would like to use the prior year 3% rule but can't. Can you take a look at this plan and advise how we can get ASC to do this?
The ADP test reads from the Plan Identification (ID) screen in the general specs to see if it should use the 3% first year rule. Change the Plan Effective date from 1/1/1990 to 1/1/2003 to get the test to turn on the 3% option (i.e. to make the "First PYE: Use Calc Pct" field active). If you still have eligibilty or vesting functions to run that would be affected by the change in the effective date, copy the plan to run the test with the 2003 effective date to avoid messing up calculated entry and vesting start dates.