Non-electing Church plans are exempt from discrimination testing....preERISA rules generally apply. IRS Notice 2001-46 essentially is silent about K & M testing on 401(k) plans adopted by churches.
I don't believe they are subject to K&M testing.
Is there any IRS pronoucement that settles this issue? Since 403(b) church plans are clearly and uniquivocably exempt from any kind of contribution testing other than Deferral and 415 limits, it stands to reason that church plan 401k's would be treated similarly.
Does anyone have any opinion on this.