Safe Harbor 401(k) and 500 Hour requirement

[Guest jmurph]

I know an employer cannot use the 1,000/last day rule for safe harbor contributions, but does the reg. 1.410(B)-6(f) which allows employers not to contribute to terminating employees with less than 500 hours apply to the safe harbor match/nonelective contribution? If so, employers who match on a payroll basis may give more matching contribution than is required. Or, do employers have to give the safe harbor contribution for all eligible employees even if they terminate?

[Richard Anderson]

The safe harbor contribution can not have any qualifying requirements. If the safe harbor contribution is a match, any participant who defers is entitled to the match, regardless of hours or termination. If the contribution is the 3% non-elective, then any participant is eligible for the contribution, there can not be any hours or last day requirement.