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Minimum Coverage Testing


Guest Hunter401k

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Guest Hunter401k

I am taking over a Plan who allows everyone to contribute to the 401(k)/Safe Harbor portion of the Plan. However it is only the salaried employees eligible for the Profit Sharing portion (it's about 50/50 as to salaried and hourly employees). Am I wrong to think that the Profit Sharing portion also needs to simply pass the 70% test on it's own?

Thanks for your help in advance! I just want to be sure.

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duckthing - I believe it is a Safe Harbor Match. Everyone is eligible, assuming the reach Eligibility (21 & 1).

They want to add the Profit Sharing, so working out the testing separately. Initially they only wanted to cover the salaried employees, but there aren't enough non-highly to pass the 70% coverage

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