Top Heavy and Gateway

[jim241]

There is a safe harbor plan that is top heavy.  The plan also has a New Comp and wants to exclude 3 Non-Key employees from receiving a Profit Sharing.  These Non-Key Employees are also HCE that are excluded from receiving the Safe Harbor Non-Elective.  Can those individuals be excluded from receiving the 3% Top Heavy/Minimum Gateway OR do they have to receive a funding.

[BG5150]

They get the TH minimum (as long as they were there at EOY).  They do not get the gateway.  G/W is for NHCE only.

[jim241]

Would the profit sharing contribution nullify the safe harbor top heavy exemption? 

[BG5150]

yes

[Lou S.]

Yes.

[jim241]

So there is no exception in this situation to prevent a non-key HCE from getting a contribution? 

[BG5150]

2 minutes ago, jim241 said:

So there is no exception in this situation to prevent a non-key HCE from getting a contribution? 

Don't do a profit sharing?

[John Feldt ERPA CPC QPA]

You could amend the plan to exclude these non-key HCEs from all aspects of the plan. Next plan year they’ll have no deferral options, but they will not be required to receive any employer contributions either.