Are salary deferrals deposited late?

[Guest rhp]

The employer of a calendar year 401k plan made a $15,000 discretionary contribution 12/08/00 for 2000. The salary deferrals made by employees for 12/00 (paychecks are issued twice a month) of $2450 were not deposited until 5/15/01. Other monthly deferrals were tranmitted on time. Should the schedule H question "Did the employer fail to transmit to the plan any participant contributions within the maximum time period" described in the DOL regulations? be marked yes or no?

Also should a 5330 be filed and an excise tax paid for this situation? Thanks for your input!

[Jon Chambers]

Yes, yes, and also consider filing under the DOL's voluntary fiduciary correction program (VFC).

[Guest dl]

and don't forget to attach schedule g on the 2000 form 5500.

depending on the employer's tax year, year 2000 and 2001 forms 5330 may also need to file to irs to satisfy with the excise tax requirement.

as to dol, a full correction is not completed until the full lost investment earning ( pt occurence date to date of deposit)remits to the plan. alas...