Top Heavy 401(k)

[Guest Tim Brown]

I have a situation where a 401(k) Plan has an immediate entry for deferral purposes, but a 1 year wait (12 months, 1000 hours) for the Match. Circumstances with this plan have caused it to become top heavy. What we are trying to determine is that we have several people who work anywhere from 1 to 10 days per month (150 - 750 hours per year), but permanent employees. They do defer from time to time, but have never become eligible for any employer contributions nor have they ever accrued a year of service. Are they due top heavy minimum contributions?

[AndyH]

I think so. I know of nothing to exempt them from the top heavy minimum requirement.

[Guest]

I agree. see also Tripodi's commentsin the Erisa Outline Book under accruin benefits (Chapter 3 - page 3.119 in the 99/00 edition. such an employee is eligible for a top heavy minimum.