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Retirement Plan Limits

Q: Suppose you have a client that has two employers, and you are concerned about whether the total retirement plan limits are aggregated or separate. Information about the employers, each of which has a separate limit, is as follows:

1. Employer A pays him $300,000 a year and has a SARSEP in which it contributes $53,000 for him.
2. Employer B pays him $260,000 a year and has a 401(k) and 401(a) plan in which he contributes $24,000 and the employer contributes $18,200.

A: Does the employer own more than 50% of Employer A? If so, there is only one $53,000 limit (in 2016; $54,000 in 2017). And, if Employer A sponsors a SARSEP, the elective deferrals to that AND the 401(k)/403(b) are offsetting with only one elective deferral limit applied to all three!