cross tested formula with last day rule and safe harbor 3%

[pmacduff]

401(k) with 3% nonelective that goes to everyone and cross tested profit share allocation. profit share has last day rule but those receiving the 3% SHNEC would normally be bumped up to the gateway if necessary.

The employer is not putting in a substantial profit share for 2015 and as a result everyone (HCE and NHCE) is getting the same allocation percentage. Therefore It won't be necessary to perform nondiscrimination testing.

Since each person ends up with the same percentage can those who termed but received SHNEC be excluded from the profit share as they would, for example, under a comp to comp profit share allocation, as long as coverage passes?

This seems as though the answer should be obvious but am in a busy season fog.....

[Mike Preston]

Yes.