A. A design-based safe harbor plan is deemed to be nondiscriminatory.

B. A plan that provides an allocation that is a uniform percentage of compensation is a design-based safe harbor plan.

C. A plan that provides an allocation that is a uniform dollar amount to each participant is a nondesign-based safe harbor plan.

D. Design-based safe harbor plans must use a definition of compensation for allocation purposes that satisfies IRC §414(s).

E. A uniform points plan is a nondesign-based safe harbor plan.

A. Multiple entry dates

B. Imposing a last day requirement for allocation purposes

C. Imposing an hours of service requirement for allocation purposes

D. Limiting allocations to a total of $5,000

E. Lower allocations for one or more NHCEs

A. Rate groups that satisfy the coverage tests of IRC §410(b) are nondiscriminatory under
IRC §401(a)(4).

B. Rate groups can be tested by converting the employer contributions into allocation rates.

C. Rate groups can be tested by converting the employer contributions into EBARs.

D. Determining whether a defined contribution plan satisfies nondiscrimination requirements on a benefits basis is a type of safe harbor and avoids general testing.

E. Elective deferrals are included when determining rate groups for the average benefits portion of the general test.

A. EBARs may be expressed as percentages of average annual compensation.

B. The testing age used to normalize the benefits must be the Social Security retirement age.

C. EBARs may be expressed as dollar amounts.

D. The allocations used in the EBAR calculation may be based on the current plan year.

E. The allocations used in the EBAR calculation may be based on the current plan year and all prior years.

A. The one-third test must be determined on the basis of IRC §415 compensation.

B. The one-third test is satisfied if the lowest permissible allocation rate for any NHCE who benefits under the plan is 2% and the highest allocation rate for any HCE who benefits under the plan is 5%.

C. The 5 percent test is satisfied if each NHCE receives an allocation of 6% of IRC §415 compensation.

D. The one-third test is satisfied if the lowest permissible allocation rate for any NHCE who benefits under the plan is 3% and the highest allocation rate for any HCE who benefits under the plan is 9%.

E. Compensation from date of participation may be used in the one-third test and the 5 percent test.

A. Plans cannot be aggregated for coverage and tested separately for nondiscrimination.

B. Plans cannot be permissively aggregated unless they have the same plan year.

C. Elective deferrals can be general tested to satisfy nondiscrimination requirements.

D. A plan may permissively disaggregate otherwise excludable employees for nondiscrimination purposes.

E. Permissive disaggregation of certain portions of a plan into component parts for nondiscrimination testing is known as restructuring.

A. Participant loans are a right or feature subject to nondiscrimination requirements.

B. Life insurance is considered an ancillary benefit.

C. A lump sum distribution is an optional form of benefit.

D. Participant-direction of investments is a right or feature subject to nondiscrimination requirements.

E. A BRF is considered nondiscriminatory if it satisfies either the current availability test or the effective availability test.