When can you add a matching safe harbor contribution to an existing profit-sharing plan for the current year?

Adding a matching safe harbor contribution to an existing profit-sharing plan can only occur when there are at least three months remaining in the plan year. This is crucial for ensuring that employees can benefit from the contribution and that the plan complies with regulatory requirements for safe harbor contributions.

The reason for the three-month requirement is that it ensures sufficient time for the contributions to be made and communicated effectively to participants. Additionally, it helps maintain the plan's compliance with the safe harbor rules, which are designed to provide clarity and protection for both employers and employees regarding contribution amounts and vesting schedules.

This regulation aims to enhance the retirement savings landscape for participants by allowing for adequate timeframes for contributions to be funded while still ensuring the stability and integrity of the plan throughout the plan year.