Members of Excluded Class - Top Heavy Test

[Vlad401k]

Let's say that a company excludes one of its divisions entirely from the plan. Would that affect the Top Heavy test in any way? The software provider we are using considers excluded employees to not be participants and doesn't even count them in the Top Heavy test. However, that doesn't seem correct. Shouldn't these employees (and their year end balances) still be counted in the Top Heavy test?

[Mike Preston]

Yes.

[Mr Bagwell]

Don't forget coverage.  What is the provider doing there?

[Luke Bailey]

Do they have year-end balances because they used to participate? If they have balances, they should be included in the test.