Secure Act 2.0: 401(k) Match Issue Related to Roth Threshold

Our 401(k) plan allows employees to make before-tax and Roth after-tax contributions. Both can be done via the delivered plan type "40". One of the complexities of our plan is the company match. We match up to 6% of 401(k) eligible wages. That first percent is matched 100%. Percents 2-6 are matched 50%. The employee who contributes 6% or more of wages will receive a 3.5% match.

In testing, however, once the employee who makes a before-tax contribution hits the standard $24,500 limit but is (a) age 50 and above AND (b) has a Roth Threshold value of "Y", the before-tax is going after-tax (GOOD), the remaining before-tax amount is being matched appropriately with a "P" match (GOOD), but the after-tax match is not calculating correctly. It is as if the calculation has lost sight of the 100% match on the 1st percent.