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I'm going to have to disagree. 1.414(v)-1(e)(1)(i) says (emphasis added): This doesn't require that everyone be allowed make the maximum amount of catch-up permitted under the law, it only requires that the same limit be available to everyone. So, I think you could ignore the 60-63 catch-ups and limit everyone to the regular catch-up limit.

This is all wonderful news. I think probably 80% of my clients (i.e., the smaller ones) will not adopt this provision. Wonderful sentiment, but execution is so incredibly infeasible. And if you have less than 50 employees, you might have one person every 3 or 4 years eligible for this, and how many of them can actually contribute more than $30,000??? I just don't get it. This is wonderful for IBM and Microsoft and Amazon, but down here in the weeds it's the last thing anyone wants to deal with.

If participant born 4/11/1952 is terminated or was a 5%-owner, his Required Beginning Date is April 1, 2026 (not 12/31/2025). .... Jeff

I agree with @ratherbereading. If it is payroll period basis, I only look to make sure the amount has not violated the annual compensation limit. Other, we disclose that we are not responsible for the payroll period Match calculation.

Just to close the circle, one hopes that the Plan Administrator offered this participant the ability to have a Direct Rollover distribution, without assuming the payment should be cash. Written offer, written response.

Agree with Bri - unless you have a time machine, the distribution due to termination is taxable for the year in which the distribution ( not the termination or accrual) occurs. Cash basis reporting. Also - why is a paper Form 945 being used at all? why not use eftps.gov to remit the 945 withholding?

whoa, wait.....If she gets paid in 2024, she gets a 1099-R for 2024. Why would or should this be retroactive in any circumstance?

Also this recent article may be of interest.

I'd make sure nobody's match amount exceeded the amount a annual formula would have come up with, too. If it's 50 on 4 every week, how did this one guy end up with 2.05% for the whole year - that kind of thing...

As a further clarification to CBZeller's note that participants must have the same effective opportunity to make catch-up contributions, IRS 414(v)(2) says: This language allows for a plan to limit catch-up contributions to an amount that is lower than the catch-up limit. The Joint Committee on Taxatation General Explanation of section 109 of SECURE 2.0 says in part: This reinforces the idea that the SECURE 2.0 increased limits are themselves optional.

I hesitate to disagree with Paul since you're usually right, but in this case I think I do. The instructions for the 5500 say this: The 5500 due date (and corresponding last date to file a request for extension on Form 5558) is always the last day of the month.

Ah, well said. Serves me right for being too lazy to look it up this morning. Mea Culpa.

I agree with Jeff. The distribution calendar year is 2025, yes, but the Required Beginning Date is April 1, 2026. I see that C.B. and I were typing at the same time.

It is actually 4/1/2026. 2025 is the first distribution calendar year, but the required beginning date is April 1 of the following calendar year. The definition of "required beginning date" is found in 1.401(a)(9)-2 Q&A-2 (which has not yet been updated for SECURE, let alone SECURE 2, so mentally substitute age 73 below)

JRN, that was the case prior to the SECURE Act. The plan itself needed to be adopted by 12/31, but contributions could be made until the employer's tax-filing deadline. The original SECURE Act allowed the plan to be adopted by the tax-filing deadline and still accept deductible contributions for the retroactive year. That said, I agree that backdating the sale of stock is problematic.

Have the investment house return it to the client and they refund it back to the participant. Not as wages.

We don't check it unless the documents says it should be done on plan year comp and they are doing it each payroll.

Mods, can you move this post into the 401(k) forum? This is not a multiemployer plan question. To the actual question, in a controlled group situation the employers are considered a single employer for most purposes. You would have to read your document to see what it says, but if the contribution is discretionary then there shouldn't be an issue with differing amounts coming from different companies.

The defaults from your preapproved document provide might only increase the limit to $7,000 if the limit was previously $5,000. You could still go straight from $1,000 to $7,000 but the amendment might need the sponsor's signature. Distributions less than the force out limit are not 411(d)(6)-protected, so there is no anti-cutback issue. It does to me too - but it is actually straight out of the preamble to the proposed LTPT regulations. Here is what the IRS said: https://www.federalregister.gov/d/2023-25987/p-37