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Home/401(k) Profit Sharing & New Comparability Calculator
401(k) profit sharing / Free scenario tool

401(k) Profit Sharing &
New Comparability Calculator

Explore the contribution. Understand the tradeoff.
Compare owner contribution targets, employee funding and a common New Comparability gateway assumption. No account. No census upload. No email wall.

2025 & 2026 referencesUp to 6 target participantsCalculated in your browser
Scenario arithmetic. Not a compliance test.

A traditional pro rata profit-sharing formula generally applies the same contribution percentage to covered participants. New Comparability can use different allocation groups, subject to plan terms and testing. This tool assumes a standalone defined-contribution plan, wage employees, one common compensation basis, all HCEs entered as targets, and all other modeled participants treated as NHCEs. It does not determine eligibility, HCE status, top-heavy status, benefits-basis testing or whether the design will pass.

See exactly how the model works ↓
LOAD AN ANONYMOUS EXAMPLE
01 / THE REFERENCE YEAR

Set the framework.

Regular deferral$24,500
Annual additions$72,000
Compensation cap$360,000

No future IRS limits are projected. For an actual case, plan terms and the applicable limitation year must be confirmed.

02 / TARGET PARTICIPANTS

Who are you modeling?

Enter anonymous examples for every HCE in this simplified scenario. Target names are not requested. Regular deferrals exclude catch-ups. A target is the total nonelective contribution, including existing safe-harbor nonelective amounts.

Age is used only to display a catch-up reference. It is not used to score feasibility or to perform cross-testing.

03 / THE OTHER EMPLOYEES

Put employee cost in view.

For example, 3% safe-harbor nonelective. Not a match.
Included in cost, but not credited to the gateway illustration.

Use the sum of individually capped compensation, not uncapped payroll. The same compensation definition and period are assumed for allocations and the gateway. Aggregate data cannot establish each employee’s minimum or contribution limit.

04 / FUNDING SENSITIVITY

Explore a higher employee rate.

+0.00%
No additional rate+5 percentage points

The starting rate is the greater of the existing nonelective rate and the illustrative gateway rate. Raising this slider changes the budget, not the testing conclusion.

Jump to results ↓
Compare the distribution

The same budget can ask a different question.

See the current assumptions, an equal-rate arithmetic comparison and your modeled alternative. None is represented as a tested or recommended allocation.

Employer contributionsCurrent assumptionsSame-budget pro rata*Explored scenario

*The comparison spreads the scenario’s nonelective budget across the entered compensation at one rate; existing matches stay unchanged. It does not establish any participant’s allocation eligibility or contribution limit.

Every target stays visible

Contribution room is only one part of the picture.

TargetCapped compensationRoom for total nonelective*Modeled nonelectiveModeled rateCatch-up reference**

*Simplified annual-additions room before the target nonelective allocation, after regular deferrals, employee after-tax contributions, employer matches and other counted additions. **Shown separately, not added to employer funding or used to establish catch-up eligibility or Roth treatment.

The cost of another percentage point

Make the employee-cost tradeoff explicit.

Target contributions and existing matches stay fixed. These are funding sensitivities, not evidence that any rate will pass.

Employee nonelective rateEmployee nonelective fundingAdditional employee funding vs. currentTotal employer funding
The math is visible

Here is what this calculator does.

Useful arithmetic, with the assumptions attached.

Individual contribution room

The model starts with the lesser of the annual-additions dollar reference or the target’s entered compensation. It subtracts regular deferrals, after-tax employee contributions, employer matching contributions and other counted additions. Existing nonelective amounts are included in the total nonelective target, not subtracted a second time.

Qualified catch-up contributions are shown separately. The tool assumes a full calendar/limitation year and does not determine whether a contribution source is actually permitted.

A common gateway illustration

With the same compensation basis assumed throughout, the model compares one-third of the highest entered HCE nonelective allocation rate with the 5% alternative. It uses the lesser as a gateway illustration, then preserves any higher existing employee nonelective rate.

Those routes can use different compensation definitions in an actual plan. Matching contributions and employee deferrals are not treated as gateway funding here. A gateway calculation is not the full 401(a)(4) test.

Employee cost and comparison

The employee nonelective rate is applied to the aggregate compensation you enter. Employer matches are shown as an additional cost. A same-budget, equal-rate comparison helps explain distribution; it is not a validated pro-rata allocation.

Without individual employee data, the tool cannot establish coverage, eligibility, top-heavy minimums or employee-level contribution limits.

Outside the model

No equivalent-benefit normalization, rate-group coverage testing, permitted disparity, ADP/ACP testing, ownership attribution, top-heavy determination, plan-document interpretation, tax-savings calculation or employer deduction test is performed.

Combined DB/DC arrangements and self-employed earned-income calculations are deliberately blocked rather than forced through the standalone wage-employee formula.

Primary references

  1. IRS: Annual contribution and compensation limits
  2. IRS: 401(k) and profit-sharing plan contribution limits
  3. Treasury Regulation 1.401(a)(4)-8(b)(1)(vi)-(vii): Gateway and allocation rates
  4. IRS: Gateway methods and governing plan terms

Reference values checked September 13, 2026. Model version 1.0. Displayed figures are rounded; calculations retain precision. Do not use the output as funding instructions.

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