501(c)(3) adopt a 401(k) Plan?

[Guest Bob Lees]

Can a 501©(3) adopt a 401(k) Plan?

[Guest JPCMPLS]

Absolutely. The challenge here is determining whether the 501©(3) is better off with a 403(B) program or a 401(k) plan. SIMPLE IRA plans are also available. There are more experienced administrators for 401(k) plans available at a reasonable cost. Many mutual funds and insurance companies offer 403(B) annuities and custodial accounts, but I have found very few that offer full administration, however and have had to work with a number of non-profits to establish administrative procedures where none existed. If there are no highly compensated employees at the 501©(3), there will be very little 401(k) compliance testing (basically 402(g) and 415 limit tests).