What are people's thoughts about starting a new 401(k) plan (or adding a CODA to a PS only plan) , when the deferral effective date occurs late in the year, after October 1.
Clearly it is permissible until October 1(for a calendar year plan), as evidenced by the 3 month rule written into the SH regulations.
What about for non-safe harbor plans? Effective availability for benefits, rights, and features?
I'm not concerned about an employer that is 100% highly compensated, nor am I concern about an employer with zero highly compensated. I'm concerned about a classic small employer with a mix of highly and non-highly compensated employees who would be eligible to participate in the plan.
I have my thoughts on the subject, but I'm curious to hear others' thoughts.
