"[T]he W-2 safe harbor is based on earnings for the current year rather than the past year. Therefore, the W-2 safe harbor might make more sense for a workforce where there are no pre-tax elections for things like 401(k) plans or HSAs. The rate-of-pay safe harbor could be well-suited for a population with a large number of hourly employees since it assumes a rate of 130 hours per calendar month no matter how many hours an employee actually works. An employer with lots of low-wage earners might want to use the FPL safe harbor to avoid having a high number of individuals for whom a contribution is unaffordable under another safe harbor."  MORE >>