Secure 2.0 Section 603 Multiple Savings Plans

[Debbie_Moses]

We have a 401k plan and a 457 plan, and employees are allowed to contribute the maximum to both. The 457 plan has to consider both the EE contribution and the ER contribution when reaching the maximum ($23500) before catch-up can be triggered. All is working correctly currently, but when I ran some test cases for Section 603 requirements, the catch-up contribution for the 457 plan continues until the EE contribution reaches the maximum (not considering the ER contribution as it should). The 401k catch-up stops as expected based on how I have table VV_T5F99K2_US_BN603 configured. I think the issue is that we do not have the 457 plan marked as a Qualified Plan in V_5UBA_C. We are not able to mark both plans as Qualified Plans because our employees are allowed to contribute the maximum to both. If I mark them both as Qualified, the system considers the EE 401k plus the EE 457 when reaching the maximum, and that won't work for us. Does anyone have a recommendation as to how to meet the requirements of Section 603?

[Debbie_Moses]

I do appreciate all of your assistance with the problem we are facing. I have not been able to find the suggested BADI 'BADI_FBN_CONTRIBUTION_LIMIT' or 'FBN_CONTRIBUTION_LIMIT' . Is this the correct name of the badi we need to implement? I would really appreciate any logic that you could share with me. Thanks again!

[Chuma]

Hi @Debbie_Moses ,

You're absolutely on point, the core of the issue lies in how the system treats the 457 plan contributions under Section 603. Here's what you can consider:

Marking both the 401(k) and 457 as "Qualified Plans" in V_5UBA_C causes the system to sum EE contributions across both plans which isn't what you want.

What’s happening:

• 401(k) catch-up is working fine because VV_T5F99K2_US_BN603 is correctly configured.

• 457 plan is incorrectly triggering catch-up based only on EE contributions, ignoring ER contributions, since it’s not marked as a Qualified Plan  and that flag is what controls the inclusion of ER in the catch-up calculation.

Recommended workaround:

• Don't mark both plans as Qualified in V_5UBA_C.

• Instead, create a custom rule or enhancement in the Benefits BAdI (e.g. BADI_FBN_CONTRIBUTION_LIMIT) that handles the 457 plan catch-up separately and Manually includes both EE + ER contributions when applying the $23,500 limit before catch-up.

This lets you: ✔ Keep 401(k) logic intact.
✔ Avoid the system summing contributions incorrectly.
✔ Enforce ER+EE cap for the 457 plan as required.

for SAP Help Reference: Configure Contribution Limits
(Search for Section 603 and catch-up contributions for relevant info)

if this answered your question, please mark the response accordingly. Thank you

[Debbie_Moses]

@Chuma Thank you so much for the details. I will take a look at this suggestion to see if we can get it to work for us. It seems that since the 457 plan is not marked as qualified plan, the contributions (either EE alone or ER alone) are triggering the catch-up contribution to calculate. Is there a way (in payroll?) to 'trick' the system into thinking the 457 plan is a qualified plan and should be calculated as one?

[Chuma]

Hi @Debbie_Moses Exactly, because the 457 plan isn’t flagged as "Qualified," the system isn’t pulling both EE + ER contributions before triggering catch-up. To "trick" the system without changing the plan config: You can create a small custom rule or use BAdI_FBN_CONTRIBUTION_LIMIT to manually check EE+ER totals for the 457 plan and apply the $23,500 limit correctly. This way, you keep both 401(k) and 457 plans behaving properly without cross-contamination. If you need, I can sketch a sample logic! Best regards, Chuma