Bifurcated Testing for Cross Tested Safe Harbor 401k

[cheersmate]

5 participant plan - 3 HCEs (1 older, 2 young) and 2 NHCEs (1 older, 1 young)

Plan provides 401k, 3%SHNEC and discretionary PS by rate group (each participant is in own)

The Gateway is 5% (satisfied by 3% SHNEC + 2% Profit Sharing)

I would like to restructure for (a)4 testing: 1 HCE (older) and 1NHCE (younger) based on cross-testing and 2 HCEs (younger) and 1 NHCE (older) based on allocation rate testing.

Is the coverage for Cross-Testing component coverage: (1NHCE/2NHCEs)/(1HCE/3NHCEs) = 150%?

and the Allocation Rate component coverage: (1NHCE/2NHCEs)/(2HCE/3NHCEs) = 75%?

 

The NHCEs EBAR is at least as great as the older HCEs

The Allocation Rate is the same 5% for the 2 young HCEs and 1 older NHCE -- 3% Safe Harbor Non-Elective plus 2% Profit Sharing

 

Based on this above, the Plan passes, correct?  Am I forgetting anything?

Thank you

[Mike Preston]

Yup. Nope. Except your 2 typos. Both places you have 3NHCEs should be 3HCEs.

[cheersmate]

10 hours ago, Mike Preston said:

Yup. Nope. Except your 2 typos. Both places you have 3NHCEs should be 3HCEs.

Hello Mike - thank you. For clarification, the typos you pointed out are the denominators in the denominators. 

Happy Holidays!

[BG5150]

Who's Bill?

[cheersmate]

1 hour ago, BG5150 said:

Who's Bill?

Yikes! I corrected it, thank you so much.  

[Bri]

That's clearly a reference to Bill S. Preston, Esq. there, rather than Mike. 🙂

[cheersmate]

45 minutes ago, Bri said:

That's clearly a reference to Bill S. Preston, Esq. there, rather than Mike. 🙂

🙈 so embarrassed ... I am so sorry MIKE!!! 

[Mike Preston]

I consider it a promotion to be confused with Mr. Presson! Esq or not!