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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 is probably much more likely that plan 002 allows for 401(k) and OP just doesn't realize it. These brokerage account solo plans often use super simplified pre-approved plan docs, so I doubt the end user can permit Roth only in the document.

I could see the private rooms requiring pre-authorization, but don't see why the rest would need pre-auth. And prior auth is never required for emergency room visits, per the No Surprises Act.

If the plan requires it, you have to do it. The plan document will outline what refunds to do for a 415 excess.

The IRS takes the position that the actuarially increased $ limit for post 65 retirements cannot exceed the 401(a)(17) maximum compensation. Therefore, for 2023, the maximum DB dollar limit is effectively capped at $330,000 for ages > 68 or so. This wasn't always true, but recent (10+ years) IRS guidance has followed this thinking. That isn't exactly what you were asking, but it might be what you are thinking about. I am not sure if you can use a higher $ limit (based on AE), as long as the end result isn't higher than the comp limit / YOS. Hopefully someone else will confirm that.

One might consider these steps to follow Luke Bailey’s line of inquiry. “For purposes of section 401(a)(9), a 5-percent owner is an employee who is a 5-percent owner (as defined in section 416)[.]” 26 C.F.R. § 1.401(a)(9)-2/Q&A-2(c). That section defines: “For purposes of this paragraph, the term ‘5-percent owner’ means— (I) if the employer is a corporation, any person who owns (or is considered as owning within the meaning of section 318) more than 5 percent of the outstanding stock of the corporation or stock possessing more than 5 percent of the total combined voting power of all stock of the corporation[.]” Internal Revenue Code of 1986 (26 U.S.C.) § 416(i)(1)(B)(i)(I). That section provides: “Stock owned, directly or indirectly, by or for a trust (other than an employees’ trust described in section 401(a) which is exempt from tax under section 501(a)) shall be considered as owned by its beneficiaries in proportion to the actuarial interest of such beneficiaries in such trust.” I.R.C. § 318(a)(2)(B)(i) (emphasis added). Accord 26 C.F.R.§ 1.416-1/Q&A-17, Q&A-18. For thoroughness, one might check whether the proposed rules to interpret and implement Internal Revenue Code § 401(a)(9) answer the question similarly or differently.

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?

If you have separate documents with 001 and 002, you have two plans. They have to be considered together for limits and such, but you will need separate Form 5500s when you exceed $250k combined, or when one or both plans terminate.

You need to start with the premise that there never was a "loan". A loan is where you go to the bank and they give your the bank's money and you pay it back to the bank with interest. A 401(k) loan is where to go to your plan administrator and they give you your own money and your pay it back to yourself with interest. Once he left the company and they deducted the "loan" balance from his distribution and withheld taxes there was no "loan" left for him to repay....ever. It ceased to exist. What benefit would he accrue from paying back the loan. He cannot deduct it from his income. Tell him to make maximum contributions to the 401(k).

All good ideas. I usually argue (persuasively) that it makes no sense to not match catch-up. The match cap should limit the plan sponsor's financial exposure, if that is their concern.

ERISA section 206(a) is comparable to IRC section 401(a)(14) and would apply if ERISA applies to the 403(b) plan.