A common 401k plan design includes a “safe harbor” (“SH”) feature. By agreeing to make SH contributions for eligible employees (either conditioned on the employee making payroll-deducted contributions — a safe harbor match — or without such a condition — a safe harbor nonelective contribution), the employer is not required to potentially limit the individual contributions by “highly compensated employees” (“HCEs”) based on the average rate of contributions by non-HCEs. (Generally, those who own more than 5% of the business and those annually earning more than $125,000 are HCEs.) The SH feature generally is required to be in effect for the full 12-month plan year, subject to significant limitations on the ability to discontinue the SH contribution feature mid-year and potential adverse consequences for such a discontinuance. However, IRS guidance recently modified (according to the IRS, clarified) that a 401k plan can be amended mid-year to discontinue the SH contribution feature for only the HCEs without the otherwise applicable adverse consequences of doing so. ACSI (www.acsi-ny.com or firstname.lastname@example.org) is available to assist clients considering options regarding a safe harbor contribution feature.