Safe harbor deadline11/3/2023 ![]() ET each dayĮRPA Test Review Web Seminar, Part II – 2014 (3 parts), January 14-15-16, 2:00 p.m. ET each dayĮRPA Test Review Web Seminar, Part I – 2014 (3 parts), January 7-8-9, 2:00 p.m. (Sorry, but the discount code cannot be applied after registration has been submitted).Īdvanced Cross-Tested Plans: Adding More Tools (3 parts), December 3-4-5, 2:00 p.m. Watch for your email from SunGard Relius with your discount code. ET- Special Offer: Advanced Cross-Tested Plans Workshop attendees receive a 50% discount for this Web seminar. See details below.Ĭomponent Plans (encore presentation), October 31, 12:00 p.m. We will further discuss this plan correction and nine other typical plan errors not discussed under EPCRS during our live classroom ERISA Workshop, presented in 24 cities in October through November. Accordingly, the employer will need to take corrective action to avoid disqualification. Secondly, the IRS takes the position that a plan with a safe harbor contribution failure may not fall back on the ADP and ACP tests. First off, the employer must follow the terms of the document and make the contributions. If a plan fails to make the safe harbor contributions, could the plan simply “fall back” on the ADP and ACP tests rather than make the corrective contributions. For example, if the employer failed to make a contribution for the first quarter of a 2012 calendar year plan by June 30, 2012, the employer would calculate the earnings from June 30, 2012. The difference between a correction for an ADP nonelective contribution and an ADP annual safe harbor match is that for a periodic match, the employer must calculate the earnings from the end of the applicable plan year quarter as opposed to the end of the plan year. As an alternative, if the plan provided, the employer could correct by “truing” up the match for the plan year. However, as with the correction for the safe harbor nonelective contribution, the correction is to make the contribution plus appropriate earnings. What is the correction if an employer fails to timely make a matching contribution for a periodic match by the end of the plan year quarter following the plan year quarter in which the match was earned?Īgain, EPCRS does not specifically address this correction. The employer should calculate the earnings for the corrective contribution from December 31, 2012. For example, if the employer to make a safe harbor contribution for a 2011 calendar year plan. The plan should calculate earnings from the end of the 12 month period following the close of the plan year. ![]() ![]() Accordingly, the employer should correct the error by making the safe harbor contribution plus appropriate earnings for the late contribution. If an employer does not make the safe harbor contributions within the 12 month deadline, how does the employer correct the contribution failure? From what date should the plan calculate the earnings on the late contribution?Īlthough EPCRS does not specifically address the correction of a failure to make a safe harbor contribution, the correction should follow the general principles of EPCRS - put the participants and the plan in the position they would have been if the failure had not occurred. However, if the ACP safe harbor match is a periodic match, the employer must contribute the match no later than the plan year quarter following the plan year quarter in which it was earned The employer must make the ACP safe harbor matching contributions within 12 months after the close of the plan year. In a safe harbor 401(k) plan that includes an “other” matching contribution formula that satisfies the ACP safe harbor requirements, what is the deadline for making the matching contributions? However, if the safe harbor match is a periodic match (i.e., the employer will not “true up” the match at the end of the year), the employer must contribute the match no later than the plan year quarter following the plan year quarter in which it was earned. The employer must make the ADP safe harbor contribution within 12 months after the close of the plan year. In a safe harbor 401(k) plan, what is the deadline for making the ADP safe harbor contribution? In this Technical Update, we will discuss the correction for such a failure. For example, EPCRS does not directly address how to correct a failure to timely make a safe harbor contribution. However, EPCRS has not addressed corrections for some of the important errors that occur in safe harbor 401(k) plans. ![]() With the growth of safe harbor 401(k) plans, the IRS has devoted more attention in EPCRS such plans. Safe harbor 401(k) plans have become the fastest growing type of 401(k) plan.
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