Correcting a Multiple Plan Excess Clause Samples
The "Correcting a Multiple Plan Excess" clause outlines the procedures for addressing situations where contributions to multiple retirement or benefit plans exceed legal or plan-imposed limits. Typically, this clause specifies how excess amounts are identified, the order in which plans must correct the excess, and the steps for refunding or reallocating the surplus contributions. By providing a clear process for correcting over-contributions, the clause helps ensure compliance with regulatory requirements and prevents tax penalties or plan disqualification.
Correcting a Multiple Plan Excess. If a Participant, whose Account is credited with an excess Annual Addition, received allocations to more than one defined contribution plan, the excess shall be corrected by reducing the Annual Addition to this Plan only after all possible reductions have been made to the other defined contribution plans.