Does Reg. 1.401(m)-1(a)(3) mean that ACP testing never applies to collectively bargained plans? Or could someone give me an example of when an ACP test would be required for a collectively bargained plan?

In general, collectively bargained employees are not subject to ACP testing.

I suppose a poorly drafted plan document could subject the union employees to ACP testing even though regulations don't require it.

If you want to find other exceptions, the cross-references in the regulation you cited will eventually lead to Treas. Reg. 1.410(B)-6©(2), where you'll find other exceptions. For example, the union could have professional employees or retirement benefits were not the subject of good faith bargaining.

[This message has been edited by MWeddell (edited 05-17-2000).]

Also watch out for multiemployer plans. These plans are established by collective bargaining but often let non-collectively bargained individuals continue to participate when the "move up" to positions such as supervisors, estimators, or salesmen. Also children of corporate owners and other family members are often not considered part of the bargaining unit. In those cases each employer in the multiemployer plan has to pass the ACP test for its non-collectively bargained employes.

There are "bargaining unit alumni" rules for purposes of 410 for multiemployer plans, but I have never seen any guidance on whether these would "track over" to the ACP automatic "pass" given to collectively bargained plans.

[This message has been edited by KJohnson (edited 05-17-2000).]