FAQ 659: Calculations--Eligible employee not receiving PS allocation


Can you please take a look at the attached case? I have 1 person who should be getting a contribution because he worked over 500 hours. It looks to me like the specs are correct - but ASC is not allocating a contribution to him. Can you tell me what I've done wrong?


Because the allocation amount is less than the top-heavy minimum percentage coded in the specs, it is doing the top-heavy allocation first, and status "H" is not eligible for the top-heavy minimum per the Top Heavy Minimum screen in the specs. If you allocate a dollar amount greater than the equivalent of the top-heavy percent, he will get a portion of the allocation. This is because it has enough of a profit sharing contribution to not only satisfy the top-heavy minimum of 3%, but also do a standard profit sharing allocation. If you want him to get a piece of this allocation regardless, code Group 7 (status H) in the Top Heavy Minimum specs alongside Groups 34.