Can SH allocation formula be changed?

[K-t-F]

Client chose a 3% SH contribution when the SH 401K plan was established. He was sure everyone would contribute. Plan has a 3/31 year end. Turns out he would have saved $$ if it was a matching SH contribution.

Can the formula be amended for the 3/05 year end ? and must it be done before the 3/31/04 year end?

[jquazza]

Yes, it can be done but the problem is you need to provide the SH notice with the correct formula at least 30 days before the plan year begins. It looks like you're a little late.

[Alf]

Also, don't be so sure that the match will turn out to be cheaper. Deferrals will probably shoot up when they are required to get the company's match.

[K-t-F]

The notice timeing was what I was after... 30 days. And it has to be done before the start of the new plan year?

I dont know about the other's deferring.. it is a valid point but though.

What if the client decides to remove the K feature all together... is there a notice requirement in that situation?