Jump to content

Safe Harbor non-elective payments


bobbyM35
 Share

Recommended Posts

22 hours ago, K2retire said:

Unless the profit sharing contributions require 1000 hours and/or last day employment as is relatively common.

 

1 hour ago, Mike Preston said:

Huh? 

Mike, just because everyone is in their own group, it doesn't mean they aren't also using allocation requirements for the PS contribution. K2retire is just saying that the OP might not have gotten the PS because he wasn't employed at year end and that might be a plan design, not an employer decision.

William C. Presson, ERPA, QPA, QKA
bill.presson@gmail.com
C 205.994.4070
Connect on LinkedIn

Link to comment
Share on other sites

Thank you all for your assistance and responses!  My former employer has insisted that they have discretion whether or not to pay HCEs (although they have not provided the justification nor shown me verbiage in the SPD when I requested).  They have agreed to pay me as a "one-off exception".  I'm not going to pursue the matter further if they provide the contribution, but it doesn't seem right to me.

Link to comment
Share on other sites

On 7/31/2018 at 7:26 AM, Bill Presson said:

 

Mike, just because everyone is in their own group, it doesn't mean they aren't also using allocation requirements for the PS contribution. K2retire is just saying that the OP might not have gotten the PS because he wasn't employed at year end and that might be a plan design, not an employer decision.

But that is focusing on the profit sharing allocation and not the safe harbor.  My entire comment was geared toward the safe harbor contribution.  To circle back to the regular profit sharing is a non-sequitur, But just to be clear, if the employer is determining eligibility for the regular profit sharing contribution or determining eligibility for the safe harbor contribution based on employment status at time of contribution and that time is after the end of the plan year the plan will fail scrutiny if the IRS examines whether contributions satisfy the IRS' rules regarding definitely determinable benefits.  Note that the above concedes the issue that the plan document somehow provides the flexibility described.

Link to comment
Share on other sites

On 8/5/2018 at 11:16 AM, Mike Preston said:

But that is focusing on the profit sharing allocation and not the safe harbor.  My entire comment was geared toward the safe harbor contribution.  To circle back to the regular profit sharing is a non-sequitur, But just to be clear, if the employer is determining eligibility for the regular profit sharing contribution or determining eligibility for the safe harbor contribution based on employment status at time of contribution and that time is after the end of the plan year the plan will fail scrutiny if the IRS examines whether contributions satisfy the IRS' rules regarding definitely determinable benefits.  Note that the above concedes the issue that the plan document somehow provides the flexibility described.

Mike, go back and read your posts and the response. You specifically said "as an aside..." and then discussed 1000 hour and year end requirements for PS contributions. That's what K2 quoted and responded to. When you said "huh", I clarified.

William C. Presson, ERPA, QPA, QKA
bill.presson@gmail.com
C 205.994.4070
Connect on LinkedIn

Link to comment
Share on other sites

4 hours ago, Bill Presson said:

Mike, go back and read your posts and the response. You specifically said "as an aside..." and then discussed 1000 hour and year end requirements for PS contributions. That's what K2 quoted and responded to. When you said "huh", I clarified.

My turn to ask you to go back and read my posts.  My "aside" is saying that it makes no nevermind what the document allocation requirements are (and everybody in their own group and 1000 hours and EOY employment, etc., etc.) if the plan sponsor is using employment status at date of contribution and that date is after the end of the year to determine who gets a slice of the proverbial pie that plan WILL be disqualified as it doesn't satisfy the definitely determinable rules. Toodles.

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...