Definition of Actual Deferral Ratios


Actual Deferral Ratios means the ratio (calculated separately for each Participant and expressed as a percentage) of the Employer Tested Contributions on behalf of any Participant for the Plan Year to the Participant’s Compensation for the Plan Year;

Examples of Actual Deferral Ratios in a sentence

The provisions of this Section 3.08 shall apply to all Employer contributions and Employer matching contributions, if any are made to this Plan, which are treated as elective deferral contributions for purposes of computing Actual Deferral Ratios and satisfying the actual deferral percentage tests, in accordance with Section 3.05(b)(iv).
First, an excess contribution amount shall be determined by hypothetically reducing the Elective Contributions of those Highly Compensated Employees with the highest Actual Deferral Ratios to the extent required to meet the limitation, but not in excess of the amount that would reduce such ratios to the next highest Actual Deferral Ratio for a Highly Compensated Employee.
Actual Deferral Percentage” means the average (expressed as a percentage) of the Actual Deferral Ratios of the Participants in a group.
If these reductions are made, the ADP Test is treated as being satisfied regardless of whether the Actual Deferral Ratios, if recalculated after the reductions, satisfy the ADP Test.
If neither of the tests in Section 6.3(a) is satisfied after such reduction, the Pre-Tax Contributions made by the eligible HCEs who then have the highest Actual Deferral Ratio (including those eligible HCEs whose Pre-Tax Contributions were reduced under (A) above) shall be reduced by the amount required to cause such eligible HCEs’ Actual Deferral Ratios to equal the next highest Actual Deferral Ratio of an eligible HCE.