And, the deduction limit for profit-sharing plans has increased to 25 percent of the aggregate employees compensation. Increase in annual additions limitation. Participant loans for small business changes. The rules are changed to allow for participant loans to sole proprietors, partners, and subchapter S Corporation shareholders. This provision also applies to preexisting loans.
Small employer plan new tax credits.
This credit is available for the first three years, and only if at least one non-highly compensated employee is participating. Top Heavy Rules have been modified. The 5-year look back rule, which is applicable to distributions, has decreased to one year. Also, matching contributions will now be utilized to help satisfy top-heavy minimums. Vesting schedule changes for employer matching contributions.