Tax Consequences of Failing Coverage Testing

[Guest PBJ]

I was reading commentary which indicated that Code Section 410(b)(4) provides a special tax rule for HCEs when the reason for a plan disqualification is a failure to satisfy coverage under 410(b) or the minimum participation test under 401(a)(26). Under the special rule, the HCE's entire vested benefit is taxed as if were distributed in the plan year of disqualification.

Why, when I look at 410(b)(4), do I not see this...what am I missing?

[WDIK]

Try Code Section 402(b)(4).

(You might also try a more appropriate forum.)

[Guest PBJ]

Thank you. And, I apologize, I did not realize I was in the Plan Administration and Design forum.