John Hickman spoke at this webinar hosted by the Employee Benefits Institute of America (EBIA). Topics covered included the following:
- Highly compensated individuals and participants: A new definition with a troubling twist.
- The eligibility test: How to use the reasonable classification test with safe harbor percentages to determine if enough non-highly compensated individuals are eligible to participate (a new permissive disaggregation rule can help). Whether to run the test on a group-by-group basis if different benefits or contributions are provided to different groups of participants (e.g., salaried and hourly).
- A new objective utilization test: How to determine whether the aggregate qualified benefits elected by highly compensated participants, measured as a percentage of their aggregate compensation, exceed those elected by the non-highly compensated.
- The key employee concentration test: Determining whether nontaxable benefits provided to key employees through the cafeteria plan exceed 25% of the nontaxable benefits provided to all employees.
- A new safe harbor test for premium-only plans: How does this very helpful text work?
- Effective date of the proposed regulations: Must or should plans use the new guidance from the proposed regulations when performing the nondiscrimination tests for the 2007 plan year? When must the nondiscrimination tests be performed?
September 20, 2007