Top- Heavy 401k Plan Terminating SH Match

[Guest Sayles]

I have a top-heavy 401k plan that is terminating its safe-harbor match for the rest of 2009 due to significant business decline.

Since the plan is top-heavy, what is the required top-heavy contribution for 2009 for the NHCEs if the HCEs have not made any 401k deferrals in 2009?

There are no other types of contributions to the plan.

[jkdoll2]

If the HCE's do not contribute at all for 2009 - then there will not be a top heavy contribuiton required. If they contribute (401k) - then the amount would be at least 3% or the average percentage of the HCE's contribution - the lesser of.

Thanks

[401king]

Is it the average? Or the greatest contribution % of any KEY (not HCE)?

[jkdoll2]

Is it the average? Or the greatest contribution % of any KEY (not HCE)?

You are right - it is the greatest percentage from of any key or the 3% - which ever is less.