cpc0506 Posted May 13, 2022 Posted May 13, 2022 Client is looking to add after-tax (voluntary) contributions to their current safe harbor match plan. I understand the ACP testing and top heavy issues that arise with after-tax contributions, but I am trying to determine if the client is required to provide the Safe harbor match to the after-tax contributions. Can anyone provide some guidance? Thanks.
CuseFan Posted May 13, 2022 Posted May 13, 2022 See what the plan document says - may need to refer to the basic plan document if it's an adoption agreement - but I doubt you need to SH match voluntaries. And the usual question - why do they want voluntaries? If for owners/HCEs to do VAT/Roth conversion, that rarely works for small plans covering employees. Kenneth M. Prell, CEBS, ERPA Vice President, BPAS Actuarial & Pension Services kprell@bpas.com
MWeddell Posted July 8, 2022 Posted July 8, 2022 It is optional whether to calculate the safe harbor match based on elective deferrals (which includes any Roth contributions) or based on both elective deferrals and traditional employee after-tax contributions. See Treas. Reg. Section 1.401(k)-3(c)(5)(i).
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