Chapter 5: Profit-Sharing Plans

01.Core Concepts

• Not required to pass ADP or ACP tests • Employer must provide any one of the following: • 3% nonelective contribution  To all eligible employees • Matching contribution  100% up to 3%, and  50% from 3% to 5% • Employer contributions are 100% vested at all times • Employee election for Roth employer matching or nonelective contributions