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Showing results for tags 'last day requirement'.
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We have a safe harbor plan which provides both a non-elective contribution of 3% and a matching contribution which matches up to 6% of salary and provides 100% on the first 3% of salary deferred and 50% on the next 3% of salary deferred for a total match of 4.5%. The non-elective contribution is fully vested immediately though the matching contribution vests over 5 years. There is also a true-up at the end of the year on the matching contribution so that if an employee contributes over 6% for any period but not for the entire year, the true-up match will equal 4.5% of compensation contributed. This year, we are going to add an amendment requiring employees to be employed on the last day of the year to be eligible for the true-up, except in the case of death or disability. Does adding the last day rule, have an affect either on the plans qualification as a safe harbor plan or on whether the plan is required to perform the top heavy test?
