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Now what if we change this situation. Plan has 21/1 eligibility requirement for all purposes. Suppose the Plan excludes truck drivers as a class, for all purposes, regardless of how many years of service. If they have a year of service, still currently excluded for all purposes. Does the LTPT now require the truck drivers with 500/3 years (or 500/2 under SECURE 2.0) to be allowed to defer? I'd love some IRS clarification on this.

I would add "under current Roth rules" it must be available as a general option available for all. Maybe (but I doubt it) the IRS will change those rules and allow a plan to offer Roth only for those people whose catch-up must be Roth....

Yes. You either need to add ROTH for everyone or remove all CATCH-UPS for everyone.

It's not that they wouldn't be subject to the LTPT rules, but rather that it would be impossible for someone to have 2 consecutive 12-month periods of 500 hours of service without satisfying 1 year of elapsed time along the way. No one would ever enter as LTPT because they would have already satisfied the plan's normal eligibility requirements.

Data mining is much more accessible now though. I could download the IRS list of approval letters and do a data dump of the 2023 5500 with a couple of clicks and have a table of all plans with 2023 returns and who their document provider is. If I was still with a small TPA firm, that would concern me.

You cannot categorically exclude part-time/seasonal in your document unless it is with the caveat that if they complete 1,000 in an eligibility computation period then they enter the plan. I would think the 500 hour LTPT rules now supplement this such that you still cannot categorically exclude solely on the PT/S classification.

Interesting, there is a low stating otherwise. I do not have any of these nor will accept IRS' point of view but that's me. I did set up a 2022 DC plan for a sole-prop recently and 401k is effective in 2023. I will also check this out with an ERISA attorney and see they will say.

Does the plan document say that part time and seasonal employees are excluded? I believe that IRS guidance will require these p/t EEs to be eligible to participate after working the required number of consecutive years with 500 hours. They can still be excluded from employer contributions if they don't work 1,000 hours in a year. That is my take on it.

I would first confirm if this is an hours requirement vs elapsed time method for service and vesting and is your vesting schedule cliff or graded? If said participant worked 1000+ hours in the Plan year for 2014, 2017, that is for sure 2 years of service. Depending on other items, did the participant take a distribution? This will likely impact if they have a match or profit sharing contributions. They might have forfeited funds and if are fully vested, might not be showing depending on the Plan setup.

Remember if the only contributions are safe harbor, you are deemed not top-heavy. Otherwise Belgarath has the right cite.

A contribution to a SIMPLE IRA doesn't count against what a participant may contribute to his personal traditional or Roth IRA. His deduction of traditional IRA contributions may, however, be limited, depending on his adjusted gross income. Nondeductible contributions are discussed on page 15 of Publication 590-A. Tom Veal ERISA Cavalry PLLC www.ERISACavalry.com