Using the Main Contributory Account in the Calculation

When employers use employee contributions to offset employer contributions to the plan, part of the employee's eventual benefit is attributed to the contributions. The employee paid benefit function calculates the employee-paid portion of a benefit by projecting the final employee account balance to the normal retirement date and then converting it to an actuarially equivalent annuity.

The employee-paid portion of a benefit is not subject to vesting rules or 415 limits. You therefore use the employee-paid benefit result to separate the employee-paid and employer-paid portions of the total benefit before you apply vesting and 415.