401k along with pure p/s plan

[Guest lip]

existing 401k/ps plan(top heavy)with all people included

we want to install a new p/s plan(new comp);where partners and some rank and file are included.

new plan passes 410b on it's own;likewise 401a4.

we are being told 401k MUST provide thvy to non keys.

we argue plans are not aggregated so top heavy not issue in 401k unless keys defer in 401k;which they are not.

Please advise

ty

[buckaroo]

I have not looked at this subject for a while, but I thought I would reply. My recollection is that the plans have to be aggregated for TH if key employees were benefitting from the plans. So, I think the question is was the k plan amended to exclude key employees from participation? Was this done prior to the beginning of the plan year in question?

If the keys are still eligible for the k plan (or were for any portion of the plan year containing the determination date) then they would be considered benefitting because they had the right to defer (whether they did or not). Therefore, they would have to be aggregated to TH testing and, if found top heavy, they would have to provide a TH minimum.

Any other opinions?

[JanetM]

I agree, if keys benefited from both plans the participants in those plans have to be aggregated.

[Guest lip]

I have not looked at this subject for a while, but I thought I would reply. My recollection is that the plans have to be aggregated for TH if key employees were benefitting from the plans. So, I think the question is was the k plan amended to exclude key employees from participation? Was this done prior to the beginning of the plan year in question?

If the keys are still eligible for the k plan (or were for any portion of the plan year containing the determination date) then they would be considered benefitting because they had the right to defer (whether they did or not). Therefore, they would have to be aggregated to TH testing and, if found top heavy, they would have to provide a TH minimum.

Any other opinions?

what about 416 Q and A

T6Q ex 1??

[Guest lip]

I agree, if keys benefited from both plans the participants in those plans have to be aggregated.

what about 416 q and a

T6Q ex 1??