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Eligibility for deferrals and safe harbor match - brain freeze & need a hand


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Posted

In reading prior post I am confused, hoping you all can steer me right.

We design safe harbor match eligibility to follow deferrals whatever that might be - for ease of administration.

It is feasible to have eligibility provisions for deferrals immediate and safe harbor match 1 year. Or, deferrals immediate, safe harbor match 6 months, and profit sharing 1 year. Granted not ideal setup.

Leads me to verify all match, safe-harbor or non SH, have to be setup on same eligibility provisions? In prototypes this appears to be the case, but are there documents written to allow for such flexibility and is that really allowed?

Leads me to verify SH non-elective and Profit Sharing eligibility need to follow same eligibility provisions? In prototypes this appears to be the case, but are there documents written to allow for such flexibility and is that really allowed?

I thought that each source could have separate eligibility parameters and that safe harbor match is really going to always follow the plans' match eligibility provisions, and that SHNEC is going to always follow the plans profit sharing provision.

* If above assumptions correct, I ask if deferrals immediate, match 6 months, profit sharing 1 year. WIth SHNEC following PS and SHMATCH following match:

Can one amend plan to impose year of service for deferrals mid way through plan year essentially eliminating some employee's active participant status by changing eligibility requirements? Since a notice has been given to ee's prior to plan year, there is no way to do this because this would actually be cutting back accrued benefit? Or is way to accomplish this to provide the stop notice for match 30 days prior to effective date of eligibility amendment? How about for SHNEC? No way to amend for SHNEC right, without terminating plan?

Any thoughts are much appreciated.

Go Ducks!

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