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With it being an asset sale, the termination can be 12/31/20. It could even continue into next year. The employees are all 100% and considered terminated. So watch the coverage and discrimination tests in the contribution.

Vesting is on service not participation. There are some exceptions for service that you can exclude but unlikely to apply here. 100% vested.

Bill Presson is correct (of course)! I am glad the HR person knew and was supportive. Sometimes this can be a fight and there has been litigation. In general, if the plan sponsor does not want to true up, they should be careful to articulate the fact that the match is paycheck to paycheck without a true up.

Sure, why not? Fresh start on how you calculate the accrued benefit does not impact how you test (unless you also test from a fresh start date, which you would not want to do).

Agree. I have seen examples where a plan was "un-terminated" by amendment, and then a later termination date was selected. Just be sure someone creates the proper plan amendment(s). You should rescind the termination before the plan year end.

I think you could get a COVID extension to 12/31/20 but I think payments would need to start in January 2021. I think he might be better off offsetting the loan in 2020 as COVID related. Participant would avoid 10% tax and could spread tax over 3 years or take in 2020. And could do a COVID repayment through 2022.

@Bill, thanks so much!

If he's an HCE it goes in the ADP test, if he's an NHCE it is excluded from the ADP test. If that HCE requires ADP refund, you don't double refund the 402(g) and Excess deferral, that is the excess deferral that needs to be refunded is reduced by the amount already refunded becuse of 402(g). There is nothing magical about off calendar plans, just a bit more complicated figuring them out some times.

You need to contact your HR because we can only answer generally without seeing the plan documents. There are really two possibilities: 1. Your plan matches each payroll and ONLY considers that payroll in the calculation. If this is the case, there's nothing to be done. 2. Your plan matches each payroll and then does an additional calculation at the end of the year. We call this a true-up. It's not required but many plans do this. If this is the case, then you'll get your additional match under this calculation. Your HR dept can tell you which applies.