SEP & 401(k) same company

[mathead]

A company with 10 employees has a (prototype) SEP plan where, currently, only the business owner has met the 3 of 5 year elgibility requirement. The business owner established a 401(k) plan as of 1/1/15.

1. Can the owner make SEP contributions only to himself and make no profit sharing contribution to the 401(k)?

2. Would there be cross testing between the two plans that would require the owner to make a profit sharing contribution to employees who are elgiible to participate in the 401(k)?

[Lou S.]

If he is in the 401(k) plan you have a 416 top heavy minimum in the 401(k) due to required aggregation with the SEP.