HCE and 401k contributions

Submitted by Mhotchkiss on Thu, 2021-03-11 18:48

Is it possible that an HCE would be ineligible to contribute ANYTHING to their 401k at work? I would think they could always contribute something, perhaps limited by ACP testing. I believe they can ALWAYS contribute the over 50 catchup, correct? Help -m

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Permalink Submitted by [email protected] on Mon, 2021-03-15 13:43

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Permalink Submitted by William Tuttle on Tue, 2021-03-16 03:07

It would be an unusual set of circumstances for ADP testing failure to result in NO HCE allowed deferrals.
You are correct. Regardless, of any ADP testing failure, you are always able to max out your catch-up contribution limit. Provided the plan supports catch-up contributions (not all do).