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Was it? Clearly you don't meet the general rule of "the earliest date on which such contributions or repayments can reasonably be segregated from the employer’s general assets." If this is a plan with fewer than 100 participants at the beginning of the plan year, the safe harbor would be: So, it is deemed contributed on the earliest date on which such contributions or participant loan repayments can reasonably be segregated from the employer’s general assets if deposited no later than the 7th business day. Does mailed on a the 7th business day mean deposited on the 7th business day? I don't think so. Lets look at the final rule published on 1/14/2010. I think it is pretty clear that deposit means deposit. In your example, the deposit takes place on the 23rd, which is outside of the safe harbor window. Since the employer in your example fails to satisfy the general rule, it is their responsibility to deposit the contributions no later than the 7th business day following. The contributions are late.

All good answers already, but my comment would be that there is little (no?) excuse for mailing checks in today's world. The "vendor made me do it" excuse does not work. If the vendor does not make electronic deposit possible, the plan sponsor should choose a vendor who does support this. PNJ

You have gotten good responses previously, but I just want to state it unequivocally that this employer is WRONG in what they are doing regardless of whether mailing or receipt is the answer. They need to stop thinking about this 7/8 day window. There is no doubt they can get the check in earlier; we don't even talk to clients about the "8 day rule". They are told they need to get the money on its way the same day they do the payroll (or maybe a day or two later, but that's it). Anything else is a recipe for a problem.

fmsinc, as noted by others, there is nothing about the SECURE act that changed your scenario. Yes a Participant could elect an annuitized payout, whether storm clouds are on the horizon or not. A QDRO could not supersede such an election. I don't think it would amount to "getting away" with anything as the spouse would probably request and be entitled to some kind of payments, not directly from the plan but with the knowledge that the participant is getting "x" per month. I'm far from an expert but I don't see anything profound about it.

Dang you are good at puzzles. Bet you slay at pictionary.

Traditionally, DB participants could not commence pension payments until retirement. For those who remained employed beyond NRA, many plans provided an actuarial increase for the entire period until payment commencement, ensuring that the economic value earned as of the NRA wouldn’t be lost — but many others provided no actuarial increase. Without an actuarial adjustment the decrease in the economic value from delaying retirement could be very significant, especially where the benefit amount was frozen. In the late-1980s Congress started requiring in-service distributions once a participant reached the April 1 following the age 70½ calendar year. For a DB plan with an age 65 NRA that didn’t provided a late commencement adjustment, this requirement limited the potential loss in value from working past NRA to about six or seven years’ worth of pension payments. The requirement was repealed for non-5% owners in the early 2000s. But if a DB plan took advantage of the repeal it would have to actuarially increase the accrued benefit at least for the period after in-service distributions would have had to begin under the prior law — the period after the April 1 following the age 70½ calendar year. In other words, Congress didn’t want this repeal to remove the limit it had placed on the potential loss in pension value from working past NRA. From this perspective, it would be surprising if the current change from 70½ to 72 that applies to former employees and 5% owners was intended to also increase the allowed loss in value for non-owner participants still working past their NRA by another 18 months’ worth of pension payments.