PensionNewbee Posted January 30, 2004 Share Posted January 30, 2004 a client adopted the 3% safe harbor in 2002. For 2003, the client made the 3% contribution, but the safe harbor notice referenced the safe harbor match. The intent of the client for 2003 was to make the 3% contribution. Are they stuck with the match formula because that's what the notice said or can they allocate the 3% safe harbor? Link to comment Share on other sites More sharing options...
Archimage Posted January 30, 2004 Share Posted January 30, 2004 I'd say they are stuck. I would even go a little further. Some plan documents actually spell out exactly how the safe harbor is to be met. If it says the plan sponsor will actually do a 3% SHNEC then I think you lose safe harbor status completely for 2004. Link to comment Share on other sites More sharing options...
PensionNewbee Posted January 30, 2004 Author Share Posted January 30, 2004 Not that I am a doubting Thomas, but do you have anything more substantial than an opinion? Is there a cite? Link to comment Share on other sites More sharing options...
Archimage Posted January 30, 2004 Share Posted January 30, 2004 Notice 98-52 specifically states "the safe harbor matching or nonelective contribution formula used under the plan (including a description of the levels of matching contributions, if any, available under the plan." You have specifically stated that the safe harbor status is 3% of compensation. You have not stated that you will use a match. You cannot issue a new notice due to the timing requirement of notice 98-52. As for my comments regarding the language in the plan doc, you must follow the terms of the plan doc. 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