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I would feel confident in correcting the match as described in the OP via SCP. I would add earnings from the time each of the original matches for the other EEs were processed.

Since plan for 2020 can be adopted by tax return due date per SECURE Act, I think that is possible.

If the plan is aggregated then the contribution counts towards the overall gateway.

Ugh. So start a plan for 2020 and merge it into the current plan and become a participating employer. What one can do this way, one should be able to do the other way and save the client money.

Keep an eye out for any other employees (non-doctors) that aren't allowed in under the same 6 month period, of course. Since 410(b) testing generally uses the lowest eligibility under the plan for everyone, you might inadvertently have a bunch of extra non-benefiters among your NHCEs. (Blah blah blah disaggregation etc.....)

Thank you both very much. The employer has decided to proceed with closing access for future contributions to this source using the Administrative burden" justification. There are no investment quality considerations involved in this client's decision. Thanks again!

Since they are considered a single employer filer, I can't think of anything. If it was a multiple employer plan, then there would be. WCP

Scuba 401, the question I always ask myself is, "If this person went to the dark side, could he or she take any funds and catch a flight to a South American country?" If so, they're definitely handling plan assets. It sounds like in this situation the person could, although I may have misread your facts.

This an excellent description and looks like (with the right loan policy), I'm wrong.

Nor here.

You can't have an hours requirement for a safe harbor contribution. Ee1 will therefore get a top heavy contribution starting in 2018. You will use 12/31/2017 as your determination date for top heavy in 2018. Don't forget gateway.

I think you've done the right thing in asking for more info. The approach we'd take in that case is, "is the amount still due and payable?" If no, then it simply isn't an imminent/significant financial "need." If yes, we'd probably still question why such an old bill is outstanding and go from their.

May a plan charge only those participants who are no longer employed? For some plans, the plan’s participating employers pay some or all of the plan’s expenses. Sometimes, an employer prefers to pay expenses for its current employees, but not expenses attributable to beneficiaries, alternate payees, and participants who are no longer employees. Unless the plan’s documents expressly obligate the employer to pay the plan’s expenses, a plan may charge the plan’s reasonable expenses against the individual accounts of the plan’s participants and beneficiaries. “Nothing in Title I of ERISA limits the ability of a plan sponsor to pay only certain plan expenses or only expenses on behalf of certain plan participants. [S]uch payments by a plan sponsor on behalf of [some] plan participants are equivalent to the plan sponsor providing an increased benefit to those employees on whose behalf the expenses are paid. Therefore, [a] plan[] may charge vested separated participant accounts the account’s share ([for example], pro rata or per capita) of reasonable plan expenses, without regard to whether the accounts of active participants are [not] charged such expenses[.]” Field Assistance Bulletin 2003-3. However, a retirement plan must provide that a vested benefit that exceeds $5,000 may not be distributed without the participant’s consent. ERISA § 203(e)(1), 29 U.S.C. § 1053(e)(1); accord I.R.C. (26 U.S.C.) § 411(a)(11)(A). Interpreting both this ERISA provision and a related tax-qualified-plan condition, a Treasury department interpretation provides that a participant’s “consent” to a distribution isn’t valid if the plan imposed a “significant detriment” on a participant who doesn’t consent (and thus leaves his or her account invested under the plan.) 26 C.F.R. § 1.411(a)-11(c)(2)(i). To interpret this significant-detriment interpretation, the Treasury department stated its view that a plan may charge the accounts of former employees (even while not charging current employees) as long as the expense otherwise is proper and a severed participant’s account bears no more than its “fair share” of the plan’s expense. Rev. Rul. 2004-10, 2004-7 I.R.B. 484-485 (Feb. 17, 2004). (However, the ruling’s reasoning suggests some possibility that an expense allocation that’s more than the “analogous fee[] [that] would be imposed in the marketplace . . . for a comparable investment outside the plan” might be a precluded “significant detriment”.) To illustrate the “fair-share” idea, the Treasury department’s ruling expressly cautions that former employees’ accounts must not subsidize current employees’ accounts: “[A]llocating the expenses of active employees pro rata to all accounts, including the accounts of both active and former employees, while allocating the expenses of former employees only to their accounts” would be an improper allocation. Following this, the Treasury department said that a plan doesn’t impose a “significant detriment” because it charges beneficiaries’, alternate payees’, and severed participants’ accounts “on a pro rata basis”. The Treasury department ruling’s reference to “a pro rata basis” doesn’t mean that a plan can’t allocate expenses among accounts under what the Labor department calls a “per capita” method. The Labor department’s Bulletin uses “per capita” to express the idea of charging an account an amount that’s the same for each account in the class and that doesn’t vary based on the account balance, and uses “pro rata” to express the idea of charging an account a percentage of an account (or subaccount) balance. The Treasury department’s ruling doesn’t draw this distinction, and instead uses “pro rata” only to express the idea of allocating to accounts of former employees (or persons other than current employees) no more than those accounts’ proportionate share. Nothing in the Treasury department’s ruling says that these proportionate shares could not be computed regarding all accounts by dividing the expense by the number of accounts or allocating the expense as a percentage of plan account balances.

Mmm, we do it all the time (count the full vested balance in the 50% calc even if only allowing loans from deferrals).

No disagreement here.