Guest Boilerburm Posted May 11, 2001 Share Posted May 11, 2001 I have a client who has a top-hat plan that includes 11 of the 40 employees. (I was not involved in setting it up or running it, and just heard about it now) They have done some reading, and now fear that they are including too many people for the definition of "select group". Does anyone have any ideas on acceptable correction methods to get them back in compliance? What issues does this raise on the historical operation of the plan? Thanks for any feedback. Link to comment Share on other sites More sharing options...
Everett Moreland Posted May 11, 2001 Share Posted May 11, 2001 Prayer is the best solution I've seen. I don't know how you can correct this, other than possibly to currently distribute all benefits. You could freeze the current plan and start a new one limited to a select group. Link to comment Share on other sites More sharing options...
Guest wmacdonald Posted May 13, 2001 Share Posted May 13, 2001 I have run into this befote. First, I think you need to take a close look at the group, and determine incomes, positions etc. My first thought would be to include only the top 4 or 5 people, based on the number of people you have in the company. Then I would look to an alternative plan for the balance of this group. One suggestion is to provide a "ERISA Trust", that doesn't have to conform with the top hat rules. I explained this once on the message board. If I had a small corporation with this many key people, I'd look at it. Link to comment Share on other sites More sharing options...
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