Minimum contribution

[ombskid]

A company has 11 employees. 2 are 50% owners. The rest are HCE's. Plan allows 401k and profit sharing contributions.

The owners want 44k for themselves between 401k and profit sharing. If the plan is not top heavy, obviously due to high 401k participation of the non key HCE's, what is the minimum contribution to the non key HCE's?

[Mike Preston]

Is this a trick question? If the plan is not top-heavy then there is no minimum contribution due under that section. If there are only HCE's employed, then any allocation is considered non-discriminatory. About the only thing you would need to worry about at that point would be ancillary issues such as age-discrimination.

But if you are asking whether you could create two groups, one for the owners and another for everyone else and then make a contribution to the first group, but not to the second, I don't think that would be a problem.

[ombskid]

Sorry, I didn't mean it to sound like a trick question. I though that was the answer but was looking to see if I was missing something. It just sounds fishy.

[Blinky the 3-eyed Fish]

Don't insult me.

[Fisher]

If the non-owner HCEs are not "KEY" employees for top heavy purposes, it would seem as though the plan would be subject to top heavy minimums.

[BG5150]

What does the plan document say the allocation should be?

[WDIK]

If the non-owner HCEs are not "KEY" employees for top heavy purposes, it would seem as though the plan would be subject to top heavy minimums.

True, but the original post presents the supposition that "the plan is not top heavy, obviously due to high 401k participation of the non key HCE's."