What is true about the integration of profit-sharing plans with Social Security?

The integration of profit-sharing plans with Social Security is permitted, which aligns with option B being the correct choice. This practice allows employers to design their profit-sharing plans in a way that takes into account the benefits employees are expected to receive from Social Security.

By integrating a profit-sharing plan with Social Security, employers can provide additional retirement benefits to employees who earn above a certain threshold, acknowledging that those individuals will receive lower Social Security benefits relative to their compensation. This approach can lead to more equitable retirement outcomes, as it allows higher-paid employees to receive greater contributions to their retirement plans without exceeding the limits set forth by the IRS.

Thus, the integration can help align the benefits employees receive from both the profit-sharing plan and Social Security, providing a comprehensive retirement strategy that accommodates varying income levels. It is important for employers to understand the regulatory guidelines governing such integration to ensure compliance while offering competitive retirement benefits.