Roth 401(k)/Exclusive Roth Contributions

[Guest BED]

An employer wants to add a Roth contribution feature to its profit sharing plan. Can the plan limit deferrals to Roth deferrals and not accept any deductible deferrals? If so, I assume that the employee's deferral election would have to acknowledge that the deferrals are non-deductible Roth deferrals to meet the "designated" requirement of 402A©(1)(B). Does 402A(b)(1) require the employee to have an election between deductible and non-deductible?

[Guest darrensoup]

An employer wants to add a Roth contribution feature to its profit sharing plan. Can the plan limit deferrals to Roth deferrals and not accept any deductible deferrals? If so, I assume that the employee's deferral election would have to acknowledge that the deferrals are non-deductible Roth deferrals to meet the "designated" requirement of 402A©(1)(B). Does 402A(b)(1) require the employee to have an election between deductible and non-deductible?

The answer to this question is not clear at this time. The IRS has been asked by ASPPA to clarify this. Current wording would indicate taht a plan must allow elective deferrals in order to offer Roth Deferrals.