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Top heavy vs gateway in a combo plan


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Hi

Testing 2 plans together for all.

DB and 401k/NESH/PS plans.

Top heavy provided under DC plan only. All participants benefit under both plans.

Key employee is getting 0.5% accrual in the DB and 3% allocation of NESH (plus full deferral), no additional PS for the key.

Combined gateway minimum is 4% (including 3% NESH)

What must I provide to all non-HCE's as additional PS allocation, 1% or 2%?

My vote is 2% but just wanted to check.

Thanks

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My plan document has 4 choices for coordinating language. I'm pretty sure you need to address how the T-H minimum is provided if you don't provide it in both plans. This is from our DC plan, but there is similar coordinating language in the DB plan. We almost always use B.

A - The full top–heavy minimum will be provided in each plan (if selected, Plan Section 4.3(i) will not apply).

B - 5% defined contribution minimum

C - 2% defined benefit minimum will be made in the (enter the name of the other plan)

D - Specify the method under which the plans will provide top-heavy minimum benefits for Non-Key Employees:(enter method here) (Must be nondiscriminatory, preclude Employer discretion, and avoid inadvertent omissions).

 

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