thepensionmaven Posted February 3, 2015 Posted February 3, 2015 We are relatively new to Roth 401K and in fact do not have any at this point. Client wants to amend their profit sharing plan to a safe harbor 401(k) non-elective 3%. All participants were given the safe harbor notices for 2015 in a timely fashion, and were given the option to do Roth or regular 401K contributions, The two principals only want to deferral, and only have Roth deferrals, the other employees will not be deferring. Can you have a 401(k) that only has Roth deferrals? What is the citation?
Flyboyjohn Posted February 3, 2015 Posted February 3, 2015 From a legal/plan document standpoint you can't allow just Roth deferrals without allowing traditional deferrals. But if it turns out that all participants elect only Roth deferrals that's perfectly fine. Lou S. 1
BG5150 Posted February 4, 2015 Posted February 4, 2015 Why is that, John? QKA, QPA, CPC, ERPATwo wrongs don't make a right, but three rights make a left.
Tom Poje Posted February 4, 2015 Posted February 4, 2015 I think all he is saying is that if you have a plan that offers both deferrals and Roth deferrals, and the only $ in the plan are Roth, it is ok.
BG5150 Posted February 4, 2015 Posted February 4, 2015 But could you have a plan that allows ONLY Roth deferrals, not pre-tax? QKA, QPA, CPC, ERPATwo wrongs don't make a right, but three rights make a left.
GMK Posted February 4, 2015 Posted February 4, 2015 Not according to this: http://www.irs.gov/Retirement-Plans/Retirement-Plans-FAQs-on-Designated-Roth-Accounts#13
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