Is 100% of deferrals up to 6% SH match okay?

[BG5150]

SH Match formula is 100% up to 6% of pay.  Is this okay?

 

Is it just a discretionary match that is capped at 4% of pay?

[K2retire]

Isn't that one of the Enhanced Safe Harbor Match options?

[John Feldt ERPA CPC QPA]

I assume you want to avoid both the ADP and ACP testing. To avoid ACP, you can match deferrals that do not exceed 6% of pay. For example, you can match 200% of deferrals, ignoring any deferrals that exceed 6% of pay.

If you also provide a discretionary match, that match is limited to 4% of pay as a match and if other requirements are met, that match does not require ACP testing.

If you aren't worried about ACP and you only need to pass ADP, your safe harbor formula could be something like 100% of deferrals up to 8% of pay. You avoid ADP, but you have to run ACP testing.