Guest Frank Rizzo Posted October 30, 2002 Share Posted October 30, 2002 Can a 501©(3) entity violate 403(B)(12)(A)(ii) nondiscrimination where only elective deferrals are available through the plan? If so, would offering only one election (whereby only one HCE elected to contribute) in five plan years violate nondiscrimination? What would be the consequences? Link to comment Share on other sites More sharing options...
E as in ERISA Posted October 30, 2002 Share Posted October 30, 2002 A 501©(3) entity can violate 403(B)(12)(A)(ii) nondiscrimination if the ability to make such elective deferrals is not available to everyone. Link to comment Share on other sites More sharing options...
Guest Frank Rizzo Posted October 30, 2002 Share Posted October 30, 2002 What if the opportunity to contribute was available to everyone in year one but only one EE elected to contribute. Thereafter there were no more elections to contribute so that only that one EE was making contributions? Link to comment Share on other sites More sharing options...
mbozek Posted October 30, 2002 Share Posted October 30, 2002 The rules are clear: as long as any employee has the opportunity to make salary deferrals then all employees who work at least 20 hours a week and are not students must be allowed to make salary deferrals. There can be no closing of the opportunity to defer by employees because a 403(B) plan is not subject to the eligibility rules of IRC 410(a) or ERISA 202. There is no requirement that an employee must defer salary under a 403(B) plan--only the requirement that all eligible employees be allowed to elect deferral at all times. mjb Link to comment Share on other sites More sharing options...
Recommended Posts
Create an account or sign in to comment
You need to be a member in order to leave a comment
Create an account
Sign up for a new account in our community. It's easy!
Register a new accountSign in
Already have an account? Sign in here.
Sign In Now