QNEC's and Gateway

[austin3515]

Plan provides QNEC to Ee A of 2% to pass the ADP Test. The GWM ius 5%

1) When I run (a)(4) WITH QNEC's I find that I need to give A a 3% contribution to get him the GWM

2) When I run (a)(4) without QNEC's, A is no longer benefitting in the nonelective plan, and therefore, he does not need the gateway minimum.

3) HOWEVER, once I give profit sharing to A, I cannot run cross-testing without profit sharing (because that would be ridiculous . But when I go back and run testing without QNEC's, he's not getting the GWM!!!! So now I need to give A another 2% profit sahring.

In summary, when I do QNEC's, I have to give the full THM in profit sharing.

Someone please tell me I'm overhthinking this, and it is really not as I say...

[Tom Poje]

that sounds correct.

QNECs don't serve double duty.

Question 6 at the 2006 ASPPA Conference

Can a QNEC, used to satisfy ADP and/or ACP testing, also be used to satisfy

Gateway testing?

A. No. The QNEC can not be used for double duty (Unless the plan was a safe harbor

401(k) in which case this is permitted)