Top Heavy plan with Safe Harbor Match and New Comparability Profit Sharing

[AS TPA]

I have a plan that is top heavy and is also making a safe harbor match and new comparability profit sharing contribution for 2018. All participants are receiving a safe harbor match contribution that is equal to at least 3% of their compensation, which counts towards satisfying the top heavy minimum contribution. 

I know that if a participant is only receiving a safe harbor matching contribution that they are not treated as "benefiting" for purposes of the gateway test. But if those safe harbor matching contributions are being used to satisfy the top heavy minimum contribution requirement, does that change how the safe harbor matching contributions are treated for gateway purposes?

[Mr Bagwell]

1 hour ago, AS TPA said:

does that change how the safe harbor matching contributions are treated for gateway purposes?

No.

 

[Tom Poje]

clarification please.

you said everyone received  a safe harbor match that is equal to at least 3% of compensation. That statement almost sounds like it is a 3% safe harbor nonelective (since everyone is receiving)  or else they are all deferring (which could be), but then usually it would have been indicated everyone received a 4% safe harbor match. I only say this because I have a TPA that always calls the 3% safe harbor nonelective a safe harbor match.

[Mike Preston]

2 hours ago, Tom Poje said:

clarification please.

you said everyone received  a safe harbor match that is equal to at least 3% of compensation. That statement almost sounds like it is a 3% safe harbor nonelective (since everyone is receiving)  or else they are all deferring (which could be), but then usually it would have been indicated everyone received a 4% safe harbor match. I only say this because I have a TPA that always calls the 3% safe harbor nonelective a safe harbor match.

You should let that TPA find a different profession.

[shERPA]

I hear you!   If I was only able to bill for all the times I’ve had to say “it’s not a match”.......

[Tom Poje]

Agree Sherpa, but if I follow Mike's advice I'm first on the list of someone who  needs to find a different profession because I've used other pension terms incorrectly before.

[Tom Poje]

I should have added, if it is the 3% SHNEC, then that can be used to satisfy gateway, since it is not a match.

[Mr Bagwell]

21 hours ago, AS TPA said:

I have a plan that is top heavy and is also making a safe harbor match and new comparability profit sharing contribution for 2018. All participants are receiving a safe harbor match contribution that is equal to at least 3% of their compensation, which counts towards satisfying the top heavy minimum contribution. 

I was thrown off by this yesterday too... however, I made my own opinion that the OP was saying that a safe harbor match, which should be greater than 3% was satisfying the top heavy minimum contribution.  And I was ok with that......  :)  I didn't want to go down the rabbit hole of 3% nonelective vs. 4% match.

So I answered No.... lol.

[AS TPA]

Sorry for the confusion. This is a Safe Harbor Basic MATCH that I was asking about. Everyone is deferring at least 3% so they are all receiving a SH MATCH of at least 3%. 

[Tom Poje]

thanks for the clarification. then the original response was correct, the match can be used toward top heavy but not gateway

always like to make sure just in case terms were used improperly (speaking from experience)