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11/30 or 12/1 on notice, amendment need not be adopted until 12/31

That's probably a better question for their tax accountant (which I understand they probably don't have) but I'd have a hard time seeing where the CARES, Act option you lay out wouldn't be a better option than the 2021 default. The only scenario I can think of where taking the default in 2021 looks better is they expect to be in a lower marginal tax rate in 2021, that is they expect a big drop in income between 2020 and 2021.

I believe the exclusion is if they don't benefit by reason of termination of employment and worked less than 501 hours. Your situation appears that they don't benefit because the employer chose not to provide them with a contribution, and so I would concur with you.

Gilmore, you've answered your own question, I think.

It's unclear from your post what exactly happened but it sounds like a USSERA violation if the Employer forfeited a portion of their benefit while on active Military duty. You may want to see if the fact pattern fits one of the FAQs from the DOL. https://www.dol.gov/sites/dolgov/files/VETS/legacy/files/USERRA-Fact-Sheet-Pension-FAQs.pdf

I think the requirement to allocate those assets to participants ratably over a specified period not exceeding 6 or 7 years, I forget which, precludes their use for anything else, including payment of expenses. Deviation from that could result in excise taxes retroactively applying to those transferred assets. I also do not think that the preparation of the initial plan document is an expense eligible to be paid from plan assets.

I think you are fine for ADP, I like others I don't believe this satisfies ACP since NHCE can not receive the discretionary match and thus HCEs receive a higher rate of match - even though the intent seems to be to give HCEs the same match as NHCEs "in good years". I think this is also a contribution that is likely to blow the deemed not Top Heavy excemption. Though this seems to be one of those times that the Plan is in compliance with the spirit of the regulation, just not the letter of the regulation. But for the record, I'd like to be wrong on this because it's hard to see how what they are doing is descriminaroty in practice.

You could adopt any time up till then (9/30) with the SH (and PS, if applicable) effective back to 1/1, if desired, but deferrals cannot begin until after the plan is adopted.

The 401(k) portion of the plan has to be in effect for at least 3 months in the first plan year. They would have to adopt by 9/30/2021 if they want to be safe harbor for 2021.

Your question could be worded a little better. However what I think you meant to ask is, "Under what circumstances would a plan which covers only the substantial owner(s) of a business and their spouse(s) not be exempt from PBGC coverage under the substantial owners exemption?" This might shed some light on the question: https://www.pbgc.gov/prac/other-guidance/insurance-coverage#substantial If spousal attribution only applies in the case of a corporation, then in the case of a partnership, the spouse must themselves directly or indirectly own more than 10% of the profits or capital interest (since spousal attribution doesn't apply, I am not sure what it would mean to "indirectly" own an interest in a partnership, I am thinking community property maybe). In the case of a sole proprietorship, the spouse could never be a substantial owner. If the business is a professional service employer, then they could still be exempt even if the spouse is not considered a substantial owner.

No, that's fine. Once they take the distribution, they can do anything they want with it.

I believe it should be 11/30/2020.

The match formula is uniformly available to all eligible employees so you don't have a benefits, rights or features current availability test to perform. You may have an issue regarding the effective availability of the match rate given the unusual shape of the match formula. I don't REALLY think it is an issue, but there's enough potential that there is an issue that I'd make sure to mention it to the client in writing along with a suggestion that client consult with its legal counsel. You also may have an issue that the plan document does not specify a definite, predetermined allocation formula for the matching contributions. IRS enforcement of that requirement is quite lax. We've discussed it in another thread recently on these boards. As long as you have an opinion letter on the plan document and the employer hasn't converted the plan to a custom-designed plan, then don't worry much about this issue. You already are aware of the ACP test's application.

If the plan document allows for commencement at NRA while still employed - so you may need to amend.

DeltaRat, some pension plans do not allow for single sum distributions (rollover to IRA or cash distribution) but only allow annuity distributions at Early or Normal Retirement age.