BRF Testing

[Guest justatester2]

I have a plan that is part of a controlled group of three related plans. The plan passes 410(b) coverage on its own it is tested separately for ADP/ACP.

The plan is changing their match formula for a portion of its population thus creating a BRF issue.

Since the plan passes coverage separately, can we perform the BRF test including only the population of that plan? Or do we need to consider the employees in the other related plans? My understanding is that if a plan passes coverage separately, the BRF would be tested separately as well.

[MWeddell]

Because the plan is tested separately for 410(b) and ADP testing, yes it is tested separately for 401(a)(4) testing including the BRF testing. You want to compute the (nonexcludable NHCEs to whom the BRF in this plan is currently available / all nonexcludable NHCEs in the controlled group) / (nonexcludable HCEs to whom the BRF in this plan is currently available / all nonexcludable HCEs in the controlled group).

[Guest Sieve]

MWeddell's 1st sentence (test separately) is in conflict with the 2nd (which mathematically indicated that the testing included all members of the controlled group). In fact, only employees in the plan are considered in BRF (or other 401(a)(4)) testing if the plan passes 410(b) on its own, so other employees in the controlled group would not be taken into consideration under justatester2's situation.