Jump to content

Top Heavy with dual eligibility for deferral and safe harbor


Lou81
 Share

Recommended Posts

I need some help

i have 3% nonelective safe harbor plan

eligibility for deferrals is 6 months with quarterly entry.  eligibility for safe harbor is 1 year with quarterly entry.  plan uses entry date compensation for those that enter mid-year

The plan is top-heavy for 2020.  I know I have to give the top heavy contribution to those that are only eligible for deferral, to satisfy top heavy.

I assume i need to make an additional contribution to those that entered mid year for the safe harbor, so that they receive 3% of full year compensation. 

is this correct?

Thank you for your time!

Link to comment
Share on other sites

That is correct - every non-key employee who is in the plan for some portion/money-type and is employed at year-end must get at least 3% of annual 2020 compensation from employer contributions to satisfy top-heavy.

Kenneth M. Prell, CEBS, ERPA

Vice President, BPAS Actuarial & Pension Services

kprell@bpas.com

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...