Bri

The same as for not filing the proper form at all, I'd guess.

See, now this is the kind of thing that those Opinion Letter serial numbers are good for. Unfortunately 2013 is too far back for this, but if this had been a year these were reported, you could find a slew of clients using that document, and then you'd have a list of potential cold-calls that might hit! "Hi, you don't know me, and I don't even want your adoption agreement, just the basic plan document...."

Failing to do the safe harbor you're supposed to doesn't "default you" into ADP testing. It means you have a separate operational error to correct. But you might be outside the SCP window at this point.

I would approach it as, that should be a company check for the deposit. Where the company got the money from, I don't mind hearing/seeing/speaking no evil as to how. So that I can at least apply a standard of reasonableness

Wait a second, the plan benefit never gets to go over 100% of FAE3. That's what's forcing the payments to start early in the first place. The post-NRA adjustment is on the 290,000, not the 100%.

The new 401(b)(3) rule doesn't require the post-year-end new benefits to separately pass 401a4 in and of themselves, unlike the way an -11g amendment used to.

If the 401(k) election is recorded in writing to authorize the 24,000, then you simply have a late 401k deposit issue.

They ought to be able to, but they might need to convince either sponsor the excess has really occurred. (Otherwise this is a request for a random-ish looking withdrawal absent the knowledge of the other plan.)

415 limit is 100% of pay, not to be confused with the 25% 404 limit. None of this needs to be "employer" money. Every dollar of "profit sharing" reduces his Earned Income by the same dollar he could have done more deferral from.

True, you end up with the same max whether it's PS + K versus all being K, but you don't have any catchups since he's below the 402(g) max.

That doesn't sound so weird - but what if the exclusion was only part of the year? Would you use full year amounts or only those where the guy wasn't in an overlooked status? As a parallel to the original scenario, people who aren't eligible for a 401(k) plan at all because of their division or job category wouldn't show up as zeros in the ADP test. This is sort of inadvertently similar.

Doesn't sound like a severance of employment to me.....

I'd be treating this as a short-term impermissible loan and expect the appropriate interest returned to the plan as well to fully correct it as a prohibited transaction.

That's a more recent version, but yup!

Did you pair the proper Relius account number to that source? Like, maybe your account 201 is accidentally the match source.

Only match money can be used to refund a match test failure, definitely don't swap sources. But hey, just count the amounts to refund out of his prior distribution.

Happy retirement! I know I have a printoff of yours at least 20 years and four jobs ago detailing which Code sections don't apply to government plans, it's been a fantastic resource to have!

They should pop up if you slowly type the start of a user's name here in the comment space. @fmsinc Yours came up first on the list after I typed the @ and the f - I was given a pop-up menu of several BL users to choose from.

I bet their recordkeeping software could do it within a minute.

So if he's got the derived Earned Income number popping in somewhere else, that becomes the B2 in Miles's formula above.

No, QNECs are not subject to 402(g). Somebody could do 24,500 AND get a QNEC. They're nonelective contributions, so I suppose a sponsor could give someone a 72,000 QNEC if they wanted to be that *one* employer..... They are included in the 401(k) test if the employer elects to treat them that way. So in theory, not necessarily, but it's one of those things where the sponsor's probably making them only with the intent of including them. (And then the 401a4 rules can get slightly annoying if you do have QNECs being used in the ADP test.)

As long as they're permitted by your plan document, then that's absolutely a workable solution to the test results. QNECs in and of themselves can exist for no particular reason other than Sponsor goodwill. But they're usually provided specifically because of how they help testing results.

Well, the 31% limit is going to be 117,800. The DC portion of that can't go over 95,000. If there is a mandatory DB amount that's nonzero, that eats into the 117,800.

I suppose it depends on whether or not the DB contribution is mandatory or not. If their MRC is 0 then they could skip DB funding and do the 25% DC.

Isn't this the technicality on the difference between Nx and N(12)x?