ACP Safe Harbor

[austin3515]

I know that a plan MUST match catch-ups as part of the Safe Harbor Match Calculation. What about a discretionary match that otherwise satisfies all of the ACP Safe Harbor Requirements (in my case, the match is 50% of the first 4%, no allocation conditions).

I know what you're thinking, 18,000/265,000 is way more than 4% anyway so who cares? The catch here is, the match is calculated each pay-period, and as such towards the end of the year eligible deferrals will be zero. So it actually does end up making a difference.

Corbel's document seems to prohibit excluding catch-ups for either the ADP or ACP safe harbor's. Fidelity's on the other hand seems to apply exclusively to Safe Harbor Match calcs.

[Tom Poje]

I believe one of the reasons (if not the only reason) the rule for matching catch-ups in a safe harbor plan is to avoid NHCEs from receiving a lesser rate of match than HCEs, so that would apply to discretionary match contributions as well.

[austin3515]

_{As an example, NHCE is 55. He contributes $23,000 in 2014. Match formula is 100% of deferrals excluding catchups. The 45 year old HCE has ALL of his deferrals matched when contributing $17,500, and therefore 100% of his contributions are matched. Only 85% or so of the NHCE's are matched (I did not break out a calculator).}

_{I'm having a hard time coming up with a scenario that might actually come into play under an ACP Safe HArbor Match, or even a Basic SH Match. But then I suppose my original question is one answer - a pay-period match. My NHCE in November and December gets no match, while the HCE gets it.}