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The thing I don't get in this - a plan isn't allowed to ONLY permit Roth contributions. Was Ameritrade charging you twice as much to have two plans?

From a participant perspective, one advantage to a pay period deposit is the benefit of dollar cost averaging. The best possible scenario for a participant is a document written with an annual match but the contribution is funded per pay period (so you get both a true up and dollar cost averaging). A plan administrator may feel that an annual match funded once per year is better due to the reason's Bird provided (to which I agree).

My remarks are colored by the fact that we (a TPA firm) work in the micro plan market. My worldview is that other people - the plan sponsor, the payroll company - are going to screw things up. If you do calcs each payroll (and I am assuming the plan says this - you can have annual calcs but still make estimated deposits each payroll) you are relying on someone else to make the calcs (I hope the TPA isn't expected to do that). That's "easier" for us in theory, but prone to mistakes (that no one will ever know about, but I digress). It can also lead to unhappiness for those folks who front-load their contributions. Using annual comp is what we're used to and prefer. If someone asks how their match is calc'd, it's easy to show how it is done. If it is done by payroll you just shrug. If matches are deposited each payroll but the plan calc is annual, then yes you have true-ups. That seems fairest to me but may not be convenient. In the large plan market, and I guess some small plans, the idea is to more-or-less pay people out the minute they walk out the door, and the only way to do that is to do the calcs on a payroll basis.

Under that rule, there is no condition for an advance notice about the presumed means of communication. The rule’s conceit is that a worker will see the communication because “access to the employer’s or plan sponsor’s electronic information system is an integral part of [his or her duties as an employee][.]” 29 C.F.R. § 2520.104b-1(c)(2)(i)(B), referring to 29 C.F.R. § 2520.104b-1(c)(2)(i)(A). Further, the rule’s conditions include that “[n]otice is provided to each participant . . . , in electronic or non-electronic form, at the time a document is furnished electronically, that apprises the individual of the significance of the document when it is not otherwise reasonably evident as transmitted ([for example], the attached document describes changes in the benefits provided by your plan)[,] and of the right to request and obtain a paper version of such document[.]” 29 C.F.R. § 2520.104b-1(c)(1)(iii). I like to include in an email’s subject line some expressions to show that the communication is about the participant’s retirement, health, or other employee benefits, and why one should open and read the email. For the whole of the wired-at-work (or affirmative-consent) rule, 29 C.F.R. § 2520.104b-1(c) https://www.ecfr.gov/current/title-29/subtitle-B/chapter-XXV/subchapter-C/part-2520/subpart-F/section-2520.104b-1#p-2520.104b-1(c).

Incorrect? No. Necessary? Also no. They don't have to be the same, but they can be. What is required is that different "sources" of money in the plan are tracked separately. If you have both pre-tax and Roth contributions, each source should be credited with its own earnings, losses, fees, etc. Same if you add match or profit sharing. If you are doing this without a TPA or if the custodian cannot/will not track sources separately, it may make sense to have an account for each source. If the custodian requires new plan paperwork for each account, you will end up with more than one plan. If you are charged any fees for creating or maintaining each account/plan, and I suggest you add those fees up and look into using a TPA if comparable.

Assuming they made a timely election as your response to Lou S. indicates they did, they would have made the contribution either by the partnership's withholding the amount from year-end or later distributions, or by the partner's writing a check back to the partnership for the amount. In theory, the election created a legal obligation for the partnership to fund the contribution(s) to the plan. The partnership as the plan sponsor needs to make the contribution and then the partner's obligation to the partnership for the cash is a matter determined under the partnership agreement, which probably specially allocates it to the partner. If the individual has enough in their capital account, the partnership could pay the cash to fund the contribution and charge it against the partner's(s') capital account(s). Most partnership agreements would then require that the capital account reduction be made up from available cash distributions going forward or by the partner's writing a check.

I disagree with CuseFan only to the extent he says that the plan document should say how the correction will be handled. I agree with him and others who are saying to the extent that the error should be corrected for the reasons that they expreseed. I am fine with language authorizing the plan administrator to correct any error in administration by referencing EPCRS generally. However, I would not want the plan document to effectively tie the administrator's hands to a one-size-fits-all solution intended to work for every situation so that there is some degree of flexibility on the part of the plan administrator. If that one solution does not work in a particular instance and the plan administrator uses a different correction approach that is more appropriate, but contrary to the plan's language, this in itself gives rise to an operational error.

Yes, this isn't Monopoly (no bank error in your favor)!

It's not clear to me if there are two different plan documents or one plan that happens to include Roth deferrals that happen to be held in a separate account.

More questions than answers but we need to know the facts. An election is made on a piece of paper or some similar correspondence. The deduction for a partner is taken on the partner's 1040, Schedule 1. Did the partner take the deduction and not make the contribution? Or did they neither take the deduction nor make the contribution? If the latter I would be inclined to just move on.

Email is fine. It is only the 2020 safe harbor that requires the initial notice to be paper.

Remove from the affected participant account (along with associated gain/(loss)) to a plan holding account and use to offset future matching deposits. Participant is not entitled to data entry error in their favor.

Generally yes, lost earnings on any corrective amount is required. See Revenue Procedure 2021-30. More information is needed if you have questions about calculating the QNEC for the missed deferrals and the missed safe harbor match amount. Revenue Procedure 2021-30 https://www.irs.gov/pub/irs-drop/rp-21-30.pdf Additional information can be found here: https://www.irs.gov/retirement-plans/401k-plan-fix-it-guide