Guaranteed Non-Elective Contribution Formula Clause Samples
The Guaranteed Non-Elective Contribution Formula clause defines the employer's obligation to make a fixed, non-discretionary contribution to employees' retirement accounts, regardless of whether employees make their own contributions. Typically, this formula specifies a set percentage of each eligible employee's compensation that the employer must contribute annually. By establishing a guaranteed contribution, this clause ensures that employees receive a minimum retirement benefit, promoting fairness and compliance with retirement plan regulations.
Guaranteed Non-Elective Contribution Formula. The Employer shall make a Non-Elective Contribution equal to _________% (not less than 3%) of the Compensation of each Eligible Participant.
Guaranteed Non-Elective Contribution Formula. The Employer shall make a Non-Elective Contribution equal to _________% (not less than 3%) of the Compensation of each Eligible Participant. [ ] F. FLEXIBLE NON-ELECTIVE CONTRIBUTION FORMULA: This provision provides the Employer with the ability to amend the Plan to comply with the Safe Harbor provisions during the Plan Year. To provide such option, the Employer must amend the Plan and indicate on Schedule D that the Safe Harbor Non-Elective Contribution (not less than 3%) will be made for the specified Plan Year. Such election must comply with all the applicable notice requirements. ADDITIONAL NON-SAFE HARBOR CONTRIBUTIONS MAY BE MADE TO THE PLAN PURSUANT TO ARTICLE XI OF BASIC PLAN DOCUMENT #01. [ ] G. LIMITATIONS ON SAFE HARBOR MATCHING CONTRIBUTIONS: If a Safe Harbor Matching Contribution is made to the Plan: [ ] 1. The Employer will annualize the Safe Harbor Matching Contributions. [ ] 2. The Employer will not annualize the Safe Harbor Matching Contributions and elects to match actual Elective Deferrals made: [ ] a. on a payroll basis. [ ] b. on a monthly basis. [ ] c. on a Plan Year quarterly basis. If no election is made, the payroll period method will be used. If one of the Matching Contribution calculation periods at Section VII(G)(2) above is selected Matching Contributions must be deposited to the Plan not later than the last day of the calendar quarter next following the quarter following to which they relate. IF THE SAFE HARBOR PLAN PROVISIONS ARE ELECTED, THE ANTIDISCRIMINATION TESTS AT ARTICLE XI OF THE BASIC PLAN DOCUMENT #01 ARE NOT APPLICABLE. SAFE HARBOR CONTRIBUTIONS MADE ARE SUBJECT TO THE WITHDRAWAL RESTRICTIONS OF CODE SECTION 401(k)(2)(B) AND TREASURY REGULATIONS SECTION 1.401(k)-1(d); SUCH CONTRIBUTIONS (AND EARNINGS THEREON) MUST NOT BE DISTRIBUTABLE EARLIER THAN SEPARATION FROM SERVICE, DEATH, DISABILITY, AN EVENT DESCRIBED IN CODE SECTION 401(k)(10), OR IN THE CASE OF A PROFIT-SHARING OR STOCK BONUS PLAN, THE ATTAINMENT OF AGE 59 1/2. SAFE HARBOR CONTRIBUTIONS ARE NOT AVAILABLE FOR HARDSHIP WITHDRAWALS. THE ACP TEST SAFE HARBOR IS AUTOMATICALLY SATISFIED IF THE ONLY MATCHING CONTRIBUTION TO THE PLAN IS EITHER A BASIC MATCHING CONTRIBUTION OR AN ENHANCED MATCHING CONTRIBUTION THAT DOES NOT PROVIDE A MATCH ON ELECTIVE DEFERRALS IN EXCESS OF 6% OF COMPENSATION. FOR PLANS THAT ALLOW VOLUNTARY OR REQUIRED AFTER-TAX CONTRIBUTIONS, THE ACP TEST IS APPLICABLE WITH REGARD TO SUCH CONTRIBUTIONS. EMPLOYEES ELIGIBLE TO MAKE ELECTIVE DEFERRA...