SH Match Question

[smm]

This may be a basic SH match question, but I will ask it anyway. SH 401(k) plan currently uses the basic formula for the SH Match (100% of first 3% and 50% of next 2%). Company wants to add a discretionary match that will be a tiered match that will exceed the 6% deferral limit. Here is my question. I know that the additional discretionary match does not meet the ACP safe harbor. However, when I do the ACP test, do I only use the discretionary match, or do I use both the basic match and the discretionary match. Said another way, does the basic match automatically meet ACP regardless of the additional discretionary match? Thanks.

[Tom Poje]

since discretionary match exceeds 6% of deferrals, you must run ACP test.

you can include all match or exclude the 4% safe harbor.

see 1.401(m)-2(a)(5)(iv)

[smm]

Thanks. I just looked at the regulations. So I have a choice. I can run the ACP both with and without the basic match.