Forfeitures

[Guest rnarum]

My question concerns how forfeitures can be allocated from a Safe Harbor 401(k) Plan that was Profit Sharing Plan until it became amended in June of 2000. The Plan no longer has a Profit-Sharing feature, so no new contributions have been made to this plan. A participant that was not fully vested in the Profit Sharing plan terminated and I am concerned how to allocate dollars left in the plan. The language in the document with regard to forfeitures states that "forfeitures are allocated as a discretionary matching contribution for the Plan Year in which the forfeiture occurs." Does this language address the Profit Sharing forfeiture, and who should be eligible to recieve the forfeiture? Participants with only a Profit Sharing balance or all eligible participants? Thanks for any help you can give me.

[Guest SPOT]

I would say that unless your document diffentiates between nonelective forfeitures and match forfeitures you would allocate all forfeitures as a discretionary match.