FAQ 397: Compensation--Coding excluded compensation

Problem: I have a plan which has two definitions of compensation. I have full gross compensation for testing purposes, I believe I need to load that into the regular compensation bucket. I also have another compensation which excludes fringe benefits, bonuses, etc. in order to allocate the Profit Sharing Contribution. Where do I load this compensation in order to allocate my profit sharing contribution properly?

Solution: The full year compensation without the exclusions should be loaded in the "Plan" compensation field. The exclusions should then be loaded in the "Excluded" compensation field. The system will then add these two fields together to get total compensation for things like HCE determination. It will allocate the profit sharing on the Plan compensation. The testing screens all have the ability to include Excluded compensation, which will allow you to add back the excluded amounts as you wish.