A Safe Harbor 401(k) Plan is a type of 401(k) Plan with a mandatory employer contribution that allows the plan to satisfy annual compliance tests. The plan will automatically pass ADP and ACP Nondiscrimination Tests and will be deemed as satisfying Top Heavy minimum contribution requirements. This plan design allows highly compensated and key employees maximize their personal deferral contributions ($19,500) for 2020. If you do not offer a Safe Harbor employer contribution, your plan is subject to these tests, and there may be limitations to deferral contributions for key and highly compensated employees.
Read More