Excluding Partners

[Guest moltengater]

Would there be any reason under the regs that an employer could not exclude Partners in a Partnership from sharing in a safe harobr non-elective contribuiton - while allowing all other HCE's and NHCE's to share in the safe harbor non-elective. The partners want to contribute to the 401(k) but do not want to be included in the safe harbor.

This is a prototype plan and the exclusion options are

__ Highly Comp. - but they don't want to exclude ALL HCE's

__ Employee who have not met max age service ... - they don't want this

__ Other:_____________________________________________

(must be a category that could be excluded under permissive or mandatory disaggregation rules of

Regulation 1.401(k)-1(b)(3) or 1.401(m)-(b)(3))

Would listing "Partners" under other not suffice - as they would not be in a category that could be excluded.....

[austin3515]

How about:

Other: Partners who own > 5% of the business.

You could leave out all Partners, but then if any end up owning less than 5% you need to watch out for coverage issues.

You can always discriminate against 5% owners...

[Guest mjb]

Do any partners make less than 100k? If not then exclude all HCEs. If this option is not available find another ptype plan that provides the option you need.