Q.- Our plan year starts 7/1. We are planning to use the lookback method to determine our full-time employees for the 2015 filing. Our measurement period run 5/1-4/30. Our stability period runs 7/1-6/30. Since first we started collecting hours 5/1/2014, how do we designate FTEs for the first six months of 2015?
A.- As a non-calendar year plan, you did not have a measurement period before the first one that ended in April 2015. This means that the lookback method can be use to determine who is a FTE for the months in the stability period running July 2015 through June 2016. However, you don’t know, based on your lookback results and plan structure, who is a FTE for the months January 2015-June 2015. The guidance allows an employer to either use actual hours worked (a monthly measurement) in the first six months of 2015 months and determine FTE status based on who had 130 hours in a month, OR use the apply the lookback determination to the first 6 months of 2015.