Safe harbor match document requirements

[Guest phy401k]

In a plan that uses the safe harbor match, does the document have to include matching on catch-up? I know that mathmatically it doesn't matter, but I think I remember that as a document requirement, safe harbor match must include catch-up contributions. Clarification is most appreciated! Thanks!!

[John Feldt ERPA CPC QPA]

I think it's required. If you're using a pre-approved document (prototype or volume submitter) it should be spelled out in the basic document or adoption agreement.

[401king]

I've noticed that the deferral limits and the comp. limits always seem to be outside of the range of a full safe harbor match.

For example, if you're using the basic safe harbor match, 16,500/.05 would be $330,000 comp, so anything over 16,500 could not be matched

A match of 6% max out at $275,000 comp.

I think that's why documents wouldn't specify either way, because the catch-up portion would never need to be matched since it would always be out of range of the maximum compensation.

[John Feldt ERPA CPC QPA]

Suppose the plan also has a nonelective component.

Suppose the 50-year-old NHCE making $100,000 of pay receives a $44,500 nonelective allocation (brother or girlfriend of the owner, you decide), and defers $6,000 - some of that deferral is catchup deferral.

The plan should say something about getting safe harbor match on that deferral.

Other example: Someone eligible for 2 plans during the year (switched jobs) who deferred the max in one plan, but that plan allows no catchup deferrals. They defer only catch-up in the SH match plan. SH match should be applied.

Note:Edited to make the 1st example not exceed 415.

[Kevin C]

From the preamble to the final 401(k) Regs:

The proposed regulations did not include any exception to the requirements for safe harbor matching contributions with respect to catch-up contributions. As part of the proposed regulations the IRS and Treasury solicited comments on the specific circumstances under which elective contributions by an NHCE to a safe harbor plan would be less than the amount required to be matched, e.g., less than 5% of safe harbor compensation, but would be treated by the plan as catch-up contributions, and on the extent to which a safe harbor plan should be required to match catch-up contributions under such circumstances. After reviewing the comments and the applicable statutory provisions (including the amendments to section 414(v)(3)(B) made by the Job Creation and Worker Assistance Act of 2002, (JCWAA) (Public Law 107-147)), the IRS and Treasury have determined that no such exception is appropriate.