To pass the test, the ADP of the HCE group must not exceed the ADP by 1.25% or less than 2 percentage points for the NHCE group and twice the NHCE-ADP. The IRS also offers a payroll-based plan called SARSEP or Salary Reduction Simplified Employee Pension Plan. Such plans are offered by small businesses that typically employ fewer than 25 people, allowing employees to pay pre-tax contributions to their individual pension accounts (IRAs) by reducing their salaries. . . .