Topic Archive: Key Employee

How Do We Identify Highly Compensated Employees for the First Year Our Company Exists?

DWC | 08/27/19

Facts

We established our company on February 1st of this year, and now we are planning to launch our 401(k) plan.  We know there are number of tests and determinations that require us to look at company history, but as a new company, we don’t really have much of a history to look at.

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Top Heavy vs. ADP: What's the Difference?

DWC | 05/7/19

Facts

As a plan sponsor, I do my best to review the annual compliance reports my TPA sends to me, but to be honest, it might as well be written in a foreign language.  For example, several of our participants were recently required to receive corrective refunds due to contributing too much for 2018.  I thought it was because our plan was top heavy last year, but then my TPA mentioned something called an ADP test.

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Why Does Your TPA Need Personal & Ownership Details from Company Owners?

DWC | 10/2/18

Facts

Our company sponsors a 401(k) plan for our employees.  The owners of the company have always been somewhat secretive in terms of sharing detailed information about themselves and their families.  The current environment of selling information for marketing use and identity theft has only intensified that.

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Do 401(k) Testing Requirement Apply to Owner-Only Plans?

DWC | 11/14/17

Facts

I and my three business partners each own 25% of our company. We do not have any employees other than the four of us. We would like to set up a retirement plan, but we know there are nondiscrimination tests that limit how much owners can benefit based on how much the employees receive.

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