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Posted

This may seem like a dumb question, but I am just wanting to make sure I understand something.

 

I have a Safe Harbor Non Elective plan (3%) who is not going to provide any Profit Sharing or Match this year, just the 3% contribution.  Will this plan automatically pass 401(a)(4) testing? 

Posted

I agree.  It is allocated in proportion to pay and the definition of compensation must satisfy 414(s) or else it wouldn't be a SHNEC.  You must not have any unusual allocation conditions on it.  In those circumstances, your plan will satisfy a 401(a)(4) safe harbor and will not require general amounts testing.

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