Safe Harbor matching

Is there any official guidance on whether Safe Harbor matching amount (as part of ppp forgiveness) is limited to matching these 8 weeks or whether the matching can be for YTD?
I apologize if this has been asked but I did use the search engine and could not find it.

My administrator said its only 8 weeks - take annual $ x 8/52. But whether it can be done, and what category (wages, or the 25%) she was not clear. Waiting for guidance. We were discussing the 2019 contributions.

For most people, the safe harbor match being made now is for 2019- which your accountant will likely take a 2019 expense for.


  1. Can it be used for PPP forgiveness 2) Does it go towards the Wages, the 75% or the other 25%. 3) Where is the basis in the Cares Act?

We are on a fiscal year, and in January 2020 deposited our match for 10/1/18-9/30/19.
Here is the real question: can we deposit matching funds now, during the 8 week PPP period, that are part of forgivable loan for:
(a) these 8 weeks
(b) 10/1/19- 6/19/20 (end of 8 weeks of ppp
© neither
Thank you
Melissa Schwartz, MD

If the matching funds are directly correlated to the payroll during the 8-week period covered by the PPP, it is assumed (by my accountant) that it is considered part of the forgivable “payroll costs”. But, we are still waiting for guidance on that specific scenario.

You can double check, but I don’t believe you can use funds that you would pay in 2020 if it was for your 2019 Plan Year. Most of us fund the plans in the calendar year following. I think if you use PPP for this it needs to be related to your 2020 plan year.

How can you do 2020 contribution this year because calculations are incomplete as the year is not completed. If you assume and contribute for 2020 and person quits in say May, they did not meet say 1000 hours for the year, you are stuck. Anyhow, my plan administrator is saying everone is waiting for clarity from SBA.

Mr. S. Ramchandra
Bay Colony Pediatrics
2251 Fm 646 Rd West, Ste 155
Dickinson, Texas 77539

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That is true. We are big so we “allocate” that expense as we go through the year. All plans are not the same as far as structure or eligibility. Many practices will likely be unable to fund as usual for 2020.

We are all still waiting for more guidance for PPP. The information didn’t come as expected at the end of April.

We are on a fiscal year; I was hoping to be able to do the matching for 10/1/19-June 2020 for those employees here the last week of PPP; however from what I am hearing we can only do the matching for these 8 weeks. Still unclear whether it counts in the 75%. Also we checked; we were told if we “fail” the top-heavy test, we MUST do the matching.

Melissa Schwartz, MD

We asked our 401K fiduciary and were told that we could fund our non-discretionary match for YTD payroll using PPP funds and that it would count. They said that these funds would be immediately deposited into our employee’s account. Typically we would fund our 2020 401K in spring 2021 (both the non-discretionary and the profit sharing).

For the profit sharing portion, we were told we could set aside funds for that, but that it would be held in a separate account and wouldl fund once the final profit sharing amounts were calculated at the end of the year.