What does ADP stand for?

Actual Deferral Percentage Test

This definition appears very rarely and is found in the following Acronym Finder categories:

Business, finance, etc.

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Samples in periodicals archive:

Compliance tests such as the actual deferral percentage test (ADP test--IRC section 401(k)(3)) and the actual contribution percentage test (ACP tests--IRC section 401(m)(2)) prevent employers from designing 401(k) plans that benefit only highly paid personnel.

IRAs and 401(k)s: how to pick the best plan; help your firm - or your ...

The actual deferral percentage test focuses on the employee's actual deferral ratio (the deferral amount over the amount of compensation) of elective contributions made to the 401(k) plan.

New strategies for new laws

RELATED ARTICLE: EXECUTIVE SUMMARY * MANY PENSION ADVISERS recommend that employers remove highly compensated employees from their 401(k) plans to avoid failing the actual deferral percentage test or to avoid the need for testing at all.

The real cost of nonqualified deferred compensation plans