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Continued coverage of terminated highly compensated employees in a sel


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An employer wants to enter into severance agreements with several highly compensated employees to continue their benefits for several years. The Plan from which they would be receiving benefits is self-insured. This "deal" is not offered to non-highly compensated employees who are terminated. What are the 105(h) implications? These individuals are not "retirees".

Any ideas on how or if this would implicate eligibility testing?

If the amount of severance pay does not make these individuals highly compensated in any testing year are you o.k.?

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