Which statement is TRUE about a qualified retirement plan that is "top heavy"?

In the context of retirement plans, a qualified plan is considered "top heavy" when more than 60% of the plan's assets are allocated to key employees' accounts. Key employees typically include those who hold significant positions within the company, such as executives and owners, and the plan design must ensure that it benefits all employees in an equitable manner.

When a plan is determined to be top heavy, certain minimum contribution requirements must be satisfied to ensure that non-key employees receive adequate benefits. This is a protective measure designed to prevent key employees from disproportionately benefiting from the plan at the expense of other participants.

The other statements do not accurately reflect the characteristics of a top-heavy plan; for example, having less than 50% of plan assets in key employee accounts contradicts the definition of a top-heavy plan. Similarly, contributions to all employees being equal is not a requirement for plans generally, and the number of key employees must be substantial enough to exceed the thresholds outlined, which is 60% of assets in their accounts.