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February 16, 2009

Nonstandardized Safe Harbor Plan

Your Guide



A Master&Prototype Plan that would be a standardized plan except that the plan:

  • Is not required, by its terms, to benefit all nonexcludable employees and may, in the case of a defined contribution plan, condition allocations on employment on the last day of the plan year and/or the completion of up to 1000 hours of service during the plan year;
  • May use certain alternative definitions of compensation [ as described in IRC § 414(s) ] determining contributions or benefits that must be tested for nondiscrimination
  • May provide past service credit that fails to meet the safe harbor for certain grants of benefits for past periods ( described in  § 1.401(a)(4)-5(a)(3)).

Referring Cite

Rev. Proc. 2005-16,

Additional Helpful Information

  • The opinion letter issued for the plan will state that the plan is a nonstandardized safe harbor plan.

Written By

Denise Appleby

Denise is CEO of Appleby Retirement Consulting Inc., a firm that provides IRA resources for financial/ tax/legal professionals. She has over 20 years of experience in the retirement plans field, which includes training and technical consultation.

Denise writes and publishes educational /marketing tools for advisors; available at Denise co-authored several books on IRAs

Denise is a graduate of The John Marshall Law School, where she obtained a Masters of Jurisprudence in Employee Benefits, and has earned 5 professional retirement designations.
She has appeared on numerous media programs, sharing her insights on retirement tax laws.


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