SH nonelective maybe

[Bird]

Most of our SH plans are of the "maybe" variety.  Based on the SECURE Act, I took the position that the end of year 2020 notices did not need the maybe language and just said "yes it's a SH for 2020."

Then when I was writing a new plan for 2021, I automatically checked that option (maybe), but starting thinking mmmm, maybe I should just be saying "no" and amending retroactively.  I asked our doc provider, FTW, and they said (conservatively I think) that if we check the "maybe" box then we need to do the "maybe" notice.  But I'm thinking that this is just due to the fact that the docs are not amended yet for SECURE, and when those amendents are done, they will more or less fix everything (by eliminating the maybe option or exactly what, I'm not sure).

Notice 2020-86 says in A-10 "Accordingly, the retroactive plan amendment rules of § 1.401(k)-3(f) no longer apply for those plan years."  I think that means the maybe notice is defunct, dead, gone no matter what.

I hope this makes sense.  I'm not too worried about it but should I be (about not doing the maybe notice which the plan, as currently written, calls for)?

[C. B. Zeller]

With SECURE a "no" is mostly the same as a "maybe" - either way you can decide up to December 1 if you're going to be 3% safe harbor for the year. But being "maybe" and providing the notice lets you do a couple of extra things - you can make an ACP safe harbor match, and (if your notice contains the "maybe not" language) you can suspend the safe harbor without the need to be operating at an economic loss. I am having a hard time figuring out when the "maybe not" would ever be useful in this situation, you would have to basically decide in October that you wanted to be safe harbor and then change your mind a couple of weeks later. Preserving the option to do an ACP safe harbor match though is likely worth the effort to provide the notice in most cases. But I wouldn't sweat it if you missed any.

[Gadgetfreak]

My understanding, and I could be wrong, was that if you had a no provisions and amended mid-year to a yes, it is a permanent yes until amended again. The maybe->yes is only for that one year and then reverts back to maybe (as it always has). For that reason, and to preserve the cessation without loss, we did not change our procedures for our clients in light of these new rules. 

[Bird]

Thanks to both of you.  We probably should have done the full maybe notice (for 2021) but I'm not so worried.  I'm guessing FTW will come up with something that effectively replaces "maybe" with "no" and a "yes for this year and we are amending back to no" election.