Open MEP with Single Employer Cash Balance plan and Profit Sharing

[Guest_Question]

I have a question I could not find a clear answer to.

We have a Single Employer Cash Balance Plan paired with a Profit Sharing Plan (effective 2025) as they now have eligible employees to help pass testing. The employer now is looking to join an Open MEP as a Safe Harbor Matching 401K Plan to allow 401k contributions for the HCEs and employees, the MEP provider pairs with their benefits makes all contributions, provides fiduciary services etc. So they are looking to ease their admin burden for regular contributions.

My question is can we do any or either of the below scenarios:

- Cross test the clients portion of the MEP with the Cash Balance plan just as we did for 2025. Then just provide what is needed to pass any requisite  testing.

- Keep the 2 plans active as we did for 2025, and allow the employer to also enter the MEP as a 3rd plan under their control. Pass the testing of the PSP and CB plan together and allow the 3rd Safe Harbor Match 401k Plan to operate in the MEP separately. Are there additional considerations with this outside of the added cost to the employer and ABPT?

[CuseFan]

The employer's portion of the MEP is considered the same as a single employer plan for coverage, nondiscrimination, 415 limits and tax deductions, yes? If so, either scenario works, I think, that is if the MEP provisions support what you need to do for profit sharing. If the CBP is PBGC-exempt remember you have combined plan deduction rules/limits to navigate.