If you have concerns about your plan passing the Contribution Nondiscrimination Testing or Top Heavy Testing, you may want to investigate sponsoring a safe harbor 401(k) plan. A recent article by McKay Hochman Company, Inc. discusses some of the frequently asked questions on the topic.
The employee benefits consulting firm examines several aspects of safe harbor plans in the article, including:
• How safe harbor plans can satisfy ADP and ACP tests
• Acceptance of Roth Contributions, though regulations require that such contributions are accounted for separately from a safe harbor match
• If a plan only provides for elective deferrals and safe harbor matching contributions, then the plan is exempt from top heavy rules and no additional contribution will have to be made for those who do not defer
NADART offers our Safe Harbor 401(k) Plan, which allows business owners and other highly paid individuals to maximize their personal savings up to $15,500 for 2008 (or $20,500 if over age 50). We also offer Roth Contributions as a plan feature.
If you would like more information about sponsoring a NADART Safe Harbor 401(k) Plan or any of our available plan features, please contact us at (800) 462-3278, ext. 7161 or by e-mail at nadart401k@nada.org. You can also complete our online Product Information Request Form.