FAQ 506: HCE--Spouse treated as a key but not an HCE

Problem: On the attached plan the owner, Bob, is married to another participant, Julie. I have the Family Codes in the system. When determining the HCE/Key employees, ASC will make Julie a Key employee, but not an HCE. What else needs to be coded for her HCE status to be picked up?

Solution: Both of them need to have a matching "Spouse Code" coded in their records. Make and save a grid with the NAME, SPOUSE, LINDESC, and FAMILY fields from the NAME screen and run the grid prior to running your HCE/KEY calcs. You can actually sort the employees by Ownership so the affected people will be at the top.