Kryptonite is a telecommunications provider located in Iowa with hundreds of thousands of employees. Their CEO, Clark Klein, is considering the replacement of their expensive Defined Benefit (DB) Pension Plan which requires large contributions every year with a 401(K) where the employees will bear the investment risk. The majority of the workforce is young, and the top executives are all in their 50s and 60s. Answer the following:

A. Lois Kent has been with kryptonite but are nervous now that Clark has taken over operations. She wanted to know her options regarding taking money out of the 401(k) at a later date. You correctly tell her that she can access her 401(k) funds without penalty under what eight circumstances?

B. Clark has heard that the ADP testing is an issue for 401(k) plans. What are the 3 ways to minimize this issue?