Jump to content

105(h) Nondiscrimination Testing


Recommended Posts

Treas. Reg. Section 1.105-11©(2) contains the eligibility nondiscrimination test for self-insured reimbursement plans. Section ©(2)(iii)(D) contains an exclusion from testing for employees included as part of a bargaining unit. I don't see the same exclusion in Section ©(3), which contains the Benefits test. Can an employer exclude collectively bargained employees when it runs the Benefits test for its MERP?

Link to comment
Share on other sites

Good impersonation of Ben Stein!

I believe the exclusion set forth in Treas. Reg. Section 1.105-11©(2)(iii)(D) applies to the nondiscriminatory benefit requirement of ©(3) just as it does to the eligibility to participate requirement of ©(2), where specified.

The reason: ©(3) references participants, and that the same benefits for participants who are highly compensated individuals must be provided to other participants. Not to other employees generally. Participants are only employees that are eligible. Since ©(2) allows you to exclude from the eligibility rule those employees that are under a union contract, they would not be part of your participant pool for applying the ©(3) rule.

John Simmons

johnsimmonslaw@gmail.com

Note to Readers: For you, I'm a stranger posting on a bulletin board. Posts here should not be given the same weight as personalized advice from a professional who knows or can learn all the facts of your situation.

Link to comment
Share on other sites

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 account

Sign in

Already have an account? Sign in here.

Sign In Now
 Share

×
×
  • Create New...