I have argued that they shouldn't be.
We have received clarification that they are not allowed, unless the plan was created in the previous year and the person elected the contributions.
How so? Well we received it in a round about way from congress:
There is no reason that Congress would add this ability, unless they had been told that this is a gap in their Secure Act legislation. (current law)Section 320, Retroactive first year elective deferrals for sole proprietors. Under the
SECURE Act, an employer may establish a new 401(k) plan after the end of the taxable year, but
before the employer’s tax filing date and treat the plan as having been established on the last day
of the taxable year. Such plans may be funded by employer contributions up to the employer’s
tax filing date. Section 320 allows these plans, when they are sponsored by sole proprietors or
single-member LLCs, to receive employee contributions up to the date of the employee’s tax
return filing date for the initial year.
This is from the Secure Act 2.0: https://gop-waysandmeans.house.gov/wp-c ... 3.21-1.pdf
Note: this thread is not to discuss the future legislation, however it uses the future legislation as a policy stance on the meaning of the current law.