Schedule R

[Guest AJM 34]

I am doing a 5500 for a 401 Safe Harbor Profit Sharing Plan.

The plan had a distribution, therefore, Schedule R must be completed.

For Part IV, Coverage, Since the plan is SAFE HARBOR? what box I am checking (If any): The Ratio % Test, Average Benefit Test?

AJM

[WDIK]

When speaking about coverage, safe-harbor can mean something different that the term as it applies to the 401(k) contributions that allow a plan to avoid ADP testing. Please clarify what you mean by safe harbor.

[Guest AJM 34]

I am referring to the 3 % Safe-Harbor 401(k) Nonelective Contribution.

Thanks, AJM

[Leopurrd]

Well, if you used the ratio percentage test, and it didn't meet an exception to the coverage test (think 1st Page of old Schedule T exceptions), you would mark the ratio box.

If you used the Average Benefits Test for coverage, you would check that box.

I'm thinking since the plan is safe harbor, you probably meet the "All NHCE's benefitted" exception and shouldn't check either box....