LeesuhOB

Thank you.

We have a client who needs to correct a missed deferral opportunity. The error occurred last year over the course of three payrolls. The plan has auto-enrollment and therefore qualifies for the safe harbor correction method. This issue is that the participant is terminated and will not receive compensation any longer. Because the regulations state that: The plan will correct the deferrals by the first payment of compensation on or after the earlier of: 9 ½ months after end of Plan Year when failure first occurred Last day of month following employee notification of error Can the plan use the safe harbor method and not make the QNEC even though the participant will not receive compensation?