100% of first 3% of deferral percentage. 50% of next 2% for a max of 4% if defer 5% or more.

In other words, any deferral percentage of 3% and less is a match dollar for dollar. Any deferral percentage of 5% or more is a set match of 4% of wages. Any deferral between 3% and 5% equals 3 PLUS half of anything above the 3:

If the deferral percentage was 4%, the Safe Harbor Match would be 3 + (.5 x 1) = 3.5.

If the deferral percentage was 4.5%, the Safe Harbor Match would be 3 + (.5 x 1.5) = 3.75.

(FAQ09RP)