Profit sharing fundamentals
401(k) profit sharing, explained.
Start with employer contributions, allocation methods and a simple worked example before moving into specialized plan design.
Learn how 401(k) profit sharing worksThe knowledge base
Start with profit sharing.
Go deeper when the design requires it.
Begin with how employer profit-sharing contributions work, then move into New Comparability, testing rules and worked industry examples.
28 guides
Fundamentals
New Comparability, explained.
See how a business could contribute more for owners while still funding meaningful employee retirement benefits—with a simple side-by-side example.
Learn how New Comparability worksFundamentals
What is cross-testing?
Understand why age affects a profit-sharing design without having to learn actuarial formulas.
Learn how New Comparability cross-testing worksTesting
The New Comparability gateway test.
Learn the one-third-or-5% rule, see the math, and understand how an existing safe harbor contribution can count.
See the New Comparability gateway rulesTesting
401(a)(4) testing: beyond “pass.”
See what nondiscrimination testing checks, why the gateway is not enough, and what a useful final report should show.
Understand 401(a)(4) nondiscrimination testingTesting
410(b) coverage: start with the population.
Understand who must be considered before comparing contribution amounts, with a simple 70% ratio-percentage example.
Understand 410(b) coverage testingTesting
Top-heavy is a separate question.
Learn what a top-heavy plan is and how minimum employer contributions can overlap with new comparability funding.
Understand top-heavy rulesTesting
Compensation definitions change the answer.
See why W-2 wages, shareholder distributions, bonuses and self-employment income cannot simply be treated as one interchangeable payroll number.
See New Comparability compensation rulesPlan design
Allocation groups and testing rate groups.
Allocation groups decide who gets what. Testing rate groups determine whether the proposed benefits satisfy nondiscrimination requirements.
Understand allocation and testing rate groupsPlan design
Individually assigned allocation groups.
See how separate participant groups can accommodate different owner goals—and where that flexibility ends.
See individually assigned allocation groupsPlan design
Safe harbor + New Comparability.
Understand the difference between a safe harbor match and a nonelective contribution—and see how the latter can fit into a new comparability allocation.
See Safe Harbor + New Comparability designPlan design
Cash balance + New Comparability.
See how a 401(k) profit-sharing plan and a cash balance pension can fit together, and why their funding must be coordinated.
See Cash Balance + New ComparabilityTesting
Related businesses belong in the first conversation.
Understand why employees of another company may belong in the retirement-plan analysis—even when they are on a different payroll.
See controlled-group considerationsFundamentals
Who should explore New Comparability?
Use the owner’s goal, employee demographics and funding budget to decide whether a full design comparison is worth doing.
See who should explore New ComparabilityComparisons
Compare profit-sharing allocation methods.
Compare flat-dollar, pro rata, age-weighted and new comparability formulas by the question each one answers.
Compare profit-sharing allocation methodsComparisons
New Comparability vs. pro rata.
Compare the same owner target and the same total budget. Those are two different questions—and both deserve clear numbers.
Compare New Comparability vs. pro rataComparisons
New Comparability vs. age-weighted design.
Both approaches can reflect age, but they offer different control over how the employer contribution is divided.
Compare New Comparability vs. age-weightedPractical
A better owner-contribution conversation.
Start with the owner’s goal, subtract contributions already using the annual limit, then compare the employee cost of reaching the target.
Plan New Comparability owner contributionsPractical
How to read a New Comparability example.
Six fictional cases show the dollars behind a fixed budget, an owner target, different partner goals, prior safe-harbor funding, a larger staff payroll, and a design that may not be worth pursuing.
See New Comparability allocation examplesPractical
What belongs in a New Comparability census?
Build a usable employee census and avoid the missing facts that can turn an attractive illustration into a different final allocation.
Review the New Comparability census checklistPractical
Which plan documents should you request?
Find the provisions that determine whether a proposed allocation can actually be implemented.
Review the plan document checklistFundamentals / 2026 reference
2026 contribution limits.
See the 2026 limits, how employee and employer contributions fit together, and an example that avoids double-counting safe harbor funding.
See 2026 401(k) contribution limitsIndustry example
401(k) profit sharing for medical practices.
Two physician targets, staff funding and the questions that can change the result.
Read the worked exampleIndustry example
401(k) profit sharing for dental practices.
See an owner contribution target, employee allocations and safe-harbor funding in one example.
Read the worked exampleIndustry example
401(k) profit sharing for law firms.
Different partner goals make the allocation question concrete.
Read the worked exampleIndustry example
401(k) profit sharing for accounting firms.
See how owner targets and employee populations interact in a professional firm.
Read the worked exampleIndustry example
401(k) profit sharing for professional services.
A younger owner shows why a simple pro rata benchmark can sometimes be the better starting point.
Read the worked exampleIndustry example
401(k) profit sharing for family-owned businesses.
Family attribution can change who is treated as an HCE and how the design is tested.
Read the worked exampleNo guides match that search.
Try a broader term or choose All topics.
Industry guides
The same rules. Different business questions.
Use the industry guides to frame the facts that deserve a closer look.
Industry guide
For medical practices
See a physician-group allocation with two different owner targets, six staff members, and a clear total funding budget.
See New Comparability for medical practicesIndustry guide
For dental practices
A dental practice example shows the cost of a $45,000 owner contribution, with staff allocations and safe harbor funding broken out.
See New Comparability for dental practicesIndustry guide
For law firms
A law-firm example illustrates different partner contribution goals, staff allocations, and why partner compensation needs special attention.
See New Comparability for law firmsIndustry guide
For accounting firms
An accounting-firm example shows a 12% owner target, a 4% staff allocation, and the effect of keeping a seasonal employee in the review.
See New Comparability for accounting firmsIndustry guide
For professional-services firms
A younger consulting-firm owner illustrates why a simple uniform contribution can be a useful benchmark before pursuing new comparability.
See New Comparability for professional servicesIndustry guide
For family-owned businesses
See an allocation for a founder, spouse, adult child and two unrelated employees—and learn why family relationships matter to testing.
See New Comparability for family businessesNeed a practical starting point?
FAQ
Common questions.
Understand the prelaunch site, free tools and waitlist.
See New Comparability FAQsInteractive tool
A contribution scenario.
Explore contribution headroom, gateway assumptions and employer-cost scenarios.
Explore the calculatorPractical framework
Your provider said no.
Identify the rules, document or service limitation.
See what can limit a New Comparability designBetter questions today. Better tools next.
The design and testing platform is in development. Join the waitlist for early-access updates.
Start with the numbers
See what a different allocation could mean.
Same owner target. Same employer budget. Different partner goals. Each example makes the tradeoff visible.
New comparability in plain English
Start with a side-by-side owner and employee allocation.
Learn how New Comparability works →Six worked examples
Follow the compensation, percentages and employer dollars.
See the allocations →Six industry scenarios
Explore medical, dental, law, accounting, family and consulting firms.
Find an industry example →