Forfeitures and Coverage Testing

[DTH]

Would coverage testing ever apply to forfeitures that are reallocated?

[Tom Poje]

a participant is considered benefiting if they receive either an allocation of contributions or forfeitures, so yes, unless I suppose you allocate forfeitures based on account balances. I have never actually heard someone do that, because that entails nondiscrimination testing, but I think it is still possible to have that as an option.

in fact, forfeitures can ruin a safe harbor plan that would normally be considered 'top heavy free'