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Yea. Well, we've had auditors "require" us as a service provider dealing with an abandoned plan to "certify" that we visited last known address. We've done "drive by's" but under no circumstances would I ever allow anyone on my team to get out of their car. We have actually had a DOL agent, though, make a personal visit to an elderly beneficiary of a deceased participant (abandoned plan) - who thought we were scamming her. She threatened him with her cane (true story!) - and thought his "badge" was dime store bought.

That would be up to the DOL investigator.

As NJ Mike points out in last post, the IRS service center is supposed to pick up the aggregate excess deferral across all unrelated employers from the multiple W-2's and the individual is taxed on the excess in the year of deferral and in the year of distribution (because you don't get basis for what was taxed in the year of deferral). The only way out for the individual is to obtain a distribution of the excess by April 15 of year following year of deferrals. The plan document is not required to provide for distribution of excess deferrals, but most do, if requested, and of course the individual needs to understand the rules, identify each of the plans that he/she deferred into and which will distribute excess amounts, allocate excess to one or more plan(s), and request distribution sufficiently in advance of 4/15 that the distribution will be made by then. Of course, in determining which plan(s) to allocate the excess to the individual will most likely want to choose the plan with the lower(est) match.

why I remember this is beyond me, because I don't remember much of anything on the old tv game shows, especially only seeing it once (unlike a tv series) on the old Match Game show the 'fill in the blank' My cousin in so cheap. To prepare his taxes he didn't use H & R Block. instead he used _________ and the contestant answered H & R Blockhead (I doubt that software would find excess deferrals!) as I recall he didn't get any matches, but everyone was laughing so hard anyway it didn't matter.

Actually it's pre-tax + Roth limited to $18,000.

there is no where on the tax return you indicate how much you deferred. But the IRS has your W-2s, so something should kick out at their end there is an excess deferral and the person is taxed on the $350 for the year the taxes are filed. Then someday years from now the person will take a distribution and be taxed again on the $350. simply out of luck as indicated above, neither plan violated any rule so the plans are ok. If you are talking about 2016 it is probably a bit late to make any correction for the participant.

If he does nothing he can still only deduct $24,000 on the tax return but the full $24,350 will be taxed when it eventually leaves the plan of IRA. Presumably this is some thing the IRS would catch on the return but who knows for sure.

Good Luck! I'm convinced that actuaries are geniuses. I've always been good at math and statistics, but they take it to another level :-)

Testing software is generally designed to do this automatically. In fact, if the test fails, it will suggest reclassifying some of the deferrals at catch up, if the full catch up amount hasn't already been used.

We appear to be in a kind of loop. If you study the answers given you will see that everybody is in agreement that there is absolutely no need for the recordkeeping system to separately account for historical catch-ups versus non-catch-ups. However, when testing the plan for non-discrimination (such as the ADP test) the test will consider only non-catch-ups of the year in question. Think of it as a transient need. When doing current year testing the testing system will need to differentiate. But once through with testing for the year, there is no need to breakdown account balances. None.

Just as an aside - we currently have a client under DOL audit where failure to timely cash out small balances is also an issue - and the agent wants the company to restore the fees taken from those balances - EVEN THOUGHT THE MANDATORY CASH OUT IRA PROVIDER WOULD HAVE CHARGED BOTH INVESTMENT LEVEL FEES AND A PER IRA CHARGE FAR IN EXCESS OF THAT WHICH THE PLAN DOES. In fact, almost half of the subject accounts would have been consumed by the IRA provider's fees by the time the audit is complete.... I file this under the penny wise, pound stupid category - and it applies to someone else's pennies.