startup 401k plan

I have a startup 401k effective 1/1/2018.  Def and safe harbor nonelective with an effective date of 6/1.  Definition of compensation is participation comp.  Does the safe harbor nonelective get calculated on compensation from 6/1 or full year for participants with an entry date of 1/1?

Deferrals and Safe Harbor would be calculated from 6/1.  If any discretionary profit sharing is given, then that would likely be calculated from 1/1.

Good Luck!

What does the plan say?  The default in our VS document is that the safe harbor contribution calculation uses the eligibility requirements and compensation definition for salary deferrals. However, you can specify something different.  We sometimes set up new safe harbor plans mid year that use full year compensation for the initial year safe harbor contribution calculation.  Either way, the person who prepares the document should make sure the document clearly says how it works.

I don't think that if the plan has an effective date of 6/1/18, you can go back to 1/1/18 to use the entire years compensation.  Anyone who satisfied eligibility as of the plan effective date enters 6/1 and compensation is used from that date.  If I wanted to use the entire year compensation, I used a 1/1/ effecitve date.  Does anyone else have thoughts about being able to use/not use comp before effective date of plan?

1 hour ago, RM said:

I don't think that if the plan has an effective date of 6/1/18, you can go back to 1/1/18 to use the entire years compensation.  Anyone who satisfied eligibility as of the plan effective date enters 6/1 and compensation is used from that date.  If I wanted to use the entire year compensation, I used a 1/1/ effecitve date.  Does anyone else have thoughts about being able to use/not use comp before effective date of plan?

From the OP...

22 hours ago, Dawn said:

I have a startup 401k effective 1/1/2018.  Def and safe harbor nonelective with an effective date of 6/1