Guest mbw Posted August 28, 2009 Posted August 28, 2009 Do you see any issues with the following structure satisfying the 401(k) safe harbor rules. Plan X provides for two safe harbor formuals. Employees in Group A get a the NEC. Employees in Group B get the basic match.
PensionPro Posted August 28, 2009 Posted August 28, 2009 At the very least the match and nonelective would have to pass coverage testing. PensionPro, CPC, TGPC
Guest mbw Posted August 28, 2009 Posted August 28, 2009 At the very least the match and nonelective would have to pass coverage testing. In other words, you can have separate formulas (assuming other requirements met), but you treat the parts of the plan as disaggregated under the coverage rules. Right?
PensionPro Posted August 28, 2009 Posted August 28, 2009 You mandatorily disaggregate for coverage per 1.410(b)-7©. All statutorily includible NHCEs must be covered under one of the safe harbor formulas. I have not been able to find objections to your proposed arrangement. If there are any problems with it, the brilliant minds on this forum will identify them. PensionPro, CPC, TGPC
MWeddell Posted August 31, 2009 Posted August 31, 2009 If you are trying to satisfy the 401(k) / 401(m) safe harbor plan design conditions, this doesn't work. The entire plan must satisfy one of the safe harbor plan designs for the entire plan year.
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