Safe Harbor

[Guest lskin]

Isn't there something the employer had to do before the beginning of the year to be able to amend the 401k to be a Safe Harbor 401k in the middle of the year. I thought I remember something about having to give a 3% nonelective and some other requirements.

[Tom Poje]

except in the case of a brand new 401k, a safe harbor generally must be 12 months long. (exceptions being year of termination, or other short plan year) you can not amend a plan mid year to a safe harbor.

[MWeddell]

Changing the plan year is a possibility too.

Eventually you can change the plan year back to the calendar year (I'm assuming that's the current plan year) because the 401(k) regulations permit a safe harbor 401(k) plan to have a short plan year if the plan year immediately before and immediately after it are 12-month plan years using the same safe harbor option.