Originally Posted by
dalad
Once you reach the 415C limit, the company pays you an additional 15% as straight pay making my effective rate for the last 4-5 months $253 an hour for this year. The early profit sharing was worth 15K for me. I am at 275k now.
Say again?
Understood that the 15% comes as taxable pay once the limit is reached. Isn't that just a question of where the same total amount of money went? In order to reach the limit, money that would otherwise have shown up in your checking account instead showed up in your DPSP--on a dollar-for-dollar basis. In other words, the total amount of income that qualifies for 15% company contribution is unchanged, and 15% of that amount is 15%, regardless of in what form it's paid.
Yes/no? I'm new, and I'd LOVE to be wrong about this. Are you saying perhaps that the 15% earns its own 15% when it's paid directly? (Not my understanding of how it works, but again, happy to learn if I'm wrong!)