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Refreshing to see these occasional pop-culture (or should I say pops culture?) references which are lost/useless when chatting with our newer employees. Thanks

I figured some people might get that reference.

Damn, I opened a hundred packs of bubble gum and not one Joe Schlobotnik!

If the DFVCP filing is done promptly, it won't be anywhere near $750 - more like $250-$300. Go the the DFVCP calculator and enter the appropriate information. IMHO, absolutely file under DFVCP in this situation. The amount is so small that it overrides the hassle of requesting relief, even if you would be "guaranteed" to get that relief.

This sounds like it would fall under the definition of an "overpayment" under both EPCRS and SECURE 2.0 sec. 301, so you do have some correction options. I think the easiest thing to do might be to reduce the future payments. You could also amend the plan to increase the benefit so that the actual payment becomes the correct payment. The plan could ask the participant to repay the excess. What I would probably not do, is decide not to seek recoupment of the overpayment and just let the participant keep it. While this could be an acceptable option under SECURE 2.0 sec. 301 in certain cases, there is an exception for when the participant is culpable. In your case since the participant is also the sponsor, I think there is too much risk that they could be considered culpable, even if it was just an honest mistake. There is also an exception that this is not allowed if it would cause the plan to violate 415 or 401(a)(17) - I don't know if that applies in this case. Regarding spousal consent, is the benefit being paid in a form that requires spousal consent? If it's a QJSA or QOSA then the spousal consent wouldn't be needed. If it's some other form of annuity benefit, then the correction under EPCRS is to get the spousal consent now. Withholding isn't mandatory on periodic distributions. Ideally the participant would have completed a W-4P for 0% and given it to himself (as the plan administrator). If that wasn't done before, do it now.

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.

I note that 401(k)s do not backdate documents all the time. That is a scary statement. So, while I cannot address your question, I will address your statements. Only under very limited circumstances can a plan sponsor retroactively adopt 401(k) provisions, and this is newly available under SECURE 2.0. Retroactive 401(k)s are permitted beginning with the 2023 plan year for Schedule C filers who have no common-law employees. This is permitted with an unextended filing deadline in 2024. SECURE 1.0 introduced retroactive adoption for employer contribution only plans effective beginning with the 2020 plan year. While the funding deadline for retroactively adopted DC plans is the due date of the entity tax return for the applicable plan year, which includes extension, the extended funding deadline for retroactively adopted DB plans is 8 1/2 months following the end of the plan year. Be careful about quoting calendar dates. Not all plans/plan sponsors are on a calendar year cycle, and different entity types have different filing deadlines. Prior to the enactment of the SECURE Acts, all qualified retirement plans were required to be adopted by the last day of the applicable plan year, and 401(k) was a prospective provision within the plan document (and still is, with the exception noted above). Retroactive adoption and backdating are very different. Retroactive adoption is permitted under specified circumstances. Backdating is always fraud.