Originally Posted by LeineLodge

But I did ask

Your first point is the biggest one. The video seemed to indicate there was a possibility of it being up to an individual as to how much, if any, of the 401c excess would be allocated to the VEBA. Of course that won't be known until the IRS issues a ruling.

So using current limits - I'm looking at 2:45 in the video - of $265k x 16% (latest company DPSP table position), we come out with $42,400 before the excess would become a consideration. Sooner if you mis-manage your individual contributions.

This is how you can mitigate some of the money from going into the VEBA. Max 415c limit is $53,000 including your contributions. If you want the whole of the company contribution ($42,400) to go into your 401k, you cannot contribute up to your max of $18,000. You should only contribute $10,600. This way $7,300 is diverted away from the VEBA and into your paycheck.

Can't really answer the rest of it, until/if the IRS rules. I'd be a lot happier if it was totally pilot option of where any excess goes, so we could manage it to keep the balance under control or take the distribution as cash. All that said under the auspice of "it's a good problem to have"