Section 415(c) limit and multiple unrelated employer plans
Please clarify how the limit applies. Does it apply to contributions to simple IRA plans, 457 Plans, and 403(b) plans, as well as 401(k) plans? And would it apply to the aggregate of contribution, including contributions to a Voluntary Defined Contribution Plan (VDC) of an unrelated employer?
Thanks!
Tom
Permalink Submitted by Alan - IRA critic on Mon, 2025-02-17 10:30
The rules are complex. The limit generally applies separately per employer, but not to SIMPLE IRAs or 457 plans at all. It does apply to 403b plans and there is a special rule for 403b plans that treats the employee as maintaining the plan instead of the employer. Therefore if someone has a solo 401k and a 403b or a SEP IRA and 403b, the contributions must be combined to determine if the limit has been exceeded.
A combined limit also applies if the participant has a controlling interest in two 401k employers.
A VDC plan likely is treated as a 401k for these purposes and would have a separate 415c limit as long as there is no controlling interest.
Note that catch up contributions are not included as contributions relative to the 415c limit.