Group Classifications

[Guest Mike Schwing]

In a cross tested retirement plan which lists group one as

"Owner" - do you think it would be okay to list a group as

"Children of Owner?"

The plan currently uses two groups:

Owner - section 318 shall not apply for group classification

All other Eligible Employees

The Owner has an 18 year old child who would fall in the "All other eligible class - but I don't want her to get any contribution at all becuase as an HCE she kills the allocation. If I can get her in her own group and give her a $0 allocation it is greatly beneficial.

[Guest LKHartnett]

Here's an easier thing to do . . . make age 21 an eligibility requirement . . .

As for whether or not it is a kosher classification, I don't see why not . . .

[dmb]

I like to name my owner classes as "Direct Owners" and "Children of Direct Owners" and even "Spouses of Direct Owners" if necessary.

[Guest Mike Schwing]

Thanks for the reply, I like the thought of "Direct Owner"

We've always done "Owner" and then tried to clarify the 318 provisions for the groups - that 318 does not apply in the group classification. It just sometimes happens that the kids need to be in their own group.