Save time with our cheat sheets, fact sheets, checklists & books!

February 23, 2009

Gap Income



Also referred to as gap-period income.

Income accrued after the close of the plan year and prior to the distribution being processed to the participant.

Referring Cite

Treas Reg §§1.401(k)-2(b)(2)(iv)(D), 1.401(k)-2(b)(2)(viii),

Additional Helpful Information

  • Safe harbor method of allocating gap period income. –A plan may use the safe harbor method in this paragraph to determine income on excess contributions for the gap period.
  • Alternative method for allocating plan year and gap period income. –A plan may determine the allocable gain or loss for the aggregate of the plan year and the gap period by applying the alternative method .

Keep Learning

Qualified Charitable Distribution (QCD)

Definition A distribution that is excludable from the distributee’s income, as a result of meeting the following requirements: It is made after the distributee reaches

Saver’s Credit

Definition Also known as the Saver’s Tax Credit: Nonrefundable tax credit available to eligible individuals who make contributions to their retirement account. The saver’s credit

Catch-up Contribution

Definition An additional contribution that can be made to a retirement plan by a participant who is at least age-50 by the end of the

Be among the first to know when

IRA Rules