Actual deferral percentage test for nondiscrimination in a, Ask an Expert

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All the following statements concerning the actual deferral percentage (ADP) test for nondiscrimination in a 401(k) plan are correct EXCEPT

A. If a plan fails the ADP test, the plan automatically becomes disqualified.

B. The plan does not have to satisfy the ADP test if a qualifying safe harbor contribution is made.

C. The plan stands a better chance of passing the ADP test if matching employer contributions are offered.

D. Salary deferrals that are treated as Roth contributions are still subject to the ADP test.

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Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M9215402

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