BG5150

How does the plan document account for this contribution to the retirement plan?

I'd correct both of them. Remove the excess plus investment experience and put it in the suspense account. Then use it to offset the next matching deposit(s). I would not send it back tot he company as mistake of fact..

if this is a plan with individual accounts with individual investment direction, I don't see how you could make them change.

Dumb question: can it be rolled over to an IRA?

1. You don't have a "catch-up" contribution until someone hits an applicable limit. The limits are: a plan limit (ex. the plan only allows for deferrals up to 15% of compensation), 415 limit, limit due to ADP testing, 402(g) limit. You could run into a situation where someone intends on making the full $17,500 + another $5,500 during the year. So, they decide to do $1,458 "regular" and $458 "catchup" in deferrals every month. However, what if they quit or get fired after, say, April. That would be only $5,832 regular and $1,832 catchup for a total of $7,664. I doubt that would hit any of the applicable limits, so ALL of it is "regular" 401(k). 2. I doubt your document states when you are contributing the match, but rather when and how it's calculated. If you are calculating using a payroll-by-payroll match, then no true-up should be necessary; you are doing 26 (or 24 or 52) discrete calculations that all stand alone. The only time a "true-up" would/should be necessary is if something got missed. So, with a payroll based match, it won't matter how many times you change the match during the year. Each paycheck is independent of the others. 3. Does the document really say you are calculating the nonelective piece every payroll? Are there no allocation conditions?

I'd get a new election.

will 414(s) have been satisfied for all those years?

From FAB 2006-1:

That seems counterproductive on a participant level. Regs say the participant does not have to take counterproductive measures in order to qualify for the hardship. "In order for you to take a hardship distribution of $3,000, you must first pay back the outstanding loan of $5,000." "But, wait, Mr. Administrator. How can I pay the $5,000 back, when I need $3,000?"

Depending on what the TPA was engaged to do, they might not be in a position to make any corrections. It's their duty to inform the company of the issue. As Lou said, the Trustee and Plan Administrator have the responsibility to inform the participant, who in turn has the responsibility to inform his IRA provider. The TPA may or may not be doing the 1099-Rs. As mentioned above, proper 1099's will need to be done from the plan's end. That will either involve the TPA or the asset carrier. A good TPA (like me!) would monitor the situation occasionally, reminding the Administrator and/or Trustee of what needs to be done. Perhaps even help draft the letter to the participant and maybe notify the asset carrier of what happened. But, once the ball is in the Administrator's court, it is up to them to make sure it's done. it seems like the TPA did its job (with the exception of some follow-up) so far. What was the client expecting?

I don't have a direct answer, but however it turns out, just make sure the people who have been gone 5+ years do not get accelerated vesting. More accurately, review the plan document for the forfeiture rules for terminated participants (when their non-vested monies get forfeited), and make sure the people who have been gone awhile rightfully forfeit their piece if applicable.

A loan offest occurs when the participant has a defaulted loan and arrives at a distributable event under the plan.

"When Your Plan Benefit will be Distributed" sounds like a section title for the SPD, not the plan document.

Step after that, maybe EA-1

November 12, to be exact. I just signed up. Yay me!

I think you have to check state by state. NJ doesn't include Sec. 125 in Box 1. Other states do. I am always wary of using W2's to verify compensation. And find out if the client really wanted to exclude 401(k), etc. from comp. i don't think I ever purposely did not include it.

Why is it a 5500 issue? PT b/c it involved a Trustee? if so, I think the $42,000 is the amount involved. It's an operational failure--distributed too much. Correct under EPCRS. Might want to do VFCP, too.

How are you getting near 415 with or without earnings? Must've been a pretty big PS made.

Isn't catch-up $5,500?

There should be a number to call in the letter. Just call and they should probably take care of it right there.

Can you do that?

What is the calculation basis for the match? Payroll? Or Yearly?

How does an affective date of 6/1 get them off the hook? Amend to groups, everyone in own group. Or those who terminated before 6/1 in a group and everyone else in another.

I believe keeping the old policies is ok. Just like taking loans away; the old ones can stay.

No. The loan is commercial debt. Otherwise, everyone and their brother would be taking hardships to pay off student loans.