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For a CG it would be Section 1563 attribution which would be limited to/from an adult child.

The IRS considers sole proprietorships to go on and on and on and on..... until death. Your client should check with an accountant who will set him/her straight on the fact that his/her "business" was doing one thing at the beginning of the year and something else at the end of the year, but as far as the IRS is concerned it is the same business. Anything borne of the fruit that there are distinct businesses is poisonous. Act accordingly.

Unfortunately, this is almost entirely cost related. Mega companies like ADP and others offer "low cost" plans staffed by people with zero experience and education in qualified plans. What you are facing is not an uncommon result. When you race to the bottom on fees, you end up at the bottom for quality.

I very rarely suggest calling the DOL because it is almost always avoidable , but this may be one of those instances where it is appropriate. The way they are operating the plan effectively restricts catch-up contributions to highly compensated participants who can hit the $18,000 limit while still restricted to 15% of pay per payroll. That is just wrong and needs to be fixed. If you are getting nowhere with them, call the DOL. When they get a participant complaint, they have to look into it. When the DOL comes knocking, things like this will get fixed real quick.