Unfunded 3% Safe Harbor

[DP]

I have a calendar PS 401k plan where the 2007 3% nonelective SH contribution was not going to be funded until 9/15/08. There was no employer contribution for 2007. A 2008 SH notice was given to the employees stating a 3% nonelective SH contribution would be made.

All 401k contributions have been deposited timely.

This corporation has fallen into hard times and they terminated their plan on 5/16/08 with appropriate notice given to the employees.

If the corporation goes bankrupt and cannot fund the 2007 and 2008 Safe Harbor contribution, what happens?