Sponsor wants to amend PSP to allow for self-directed accounts for participants who are 100% vested. Consultant has advised that once added such a right/feature would have to be tested for non-discrimination. Looks like Reg §1.401(a)(4)-4(b)(2)(ii)(B) would allow for the 100% vested requirement to be disregarded for non-discrimination testing purposes. So if that is the only condition, then looks like a non-issue. However, I guess there could be an issue depending on whether or not there is a minimum balance requirement as that does not appear to be something that can be disregarded under the §401(a)(4) Regs.....?

I think you're right as to the impact of the vesting requirement on current availability. But, what about effective availability (& the dreaded facts & circumstances test of Treas. Reg. Section 1.401(a)(4)-4(c)(1))? As long as the revision is in place for a length of time, so that it impacts HCEs and others, efrfective availability should not be a problem (as least in the manner described in Example 3 of -4(c)(2), where the change applies to a distinct group of participants).