Personal check used for funding corporate DB

[Guest Nineteen]

I just found out that due to a mistake by a broker, a deposit was made to a client's corporate DB plan via a personal check. The money was supposed to go into his personal account, but this obviously didn't happen. This happened a couple of months ago.

The deposit would cover the 2003 contribution that needs to be made (and which the client's corporation would have trouble covering otherwise). Is there any legitimate way to recognize this for minimum funding purposes? I will address the paper trail issue for deduction purposes.

[Effen]

I don't think there is any prohibition on a company borrowing money to make a contribution. Ignoring party-in-interest stuff, could this be deemed a loan?

[Guest Nineteen]

I was leaning in that direction, although ideally the check would have come from the corporate account instead of the personal account.

Fortunately, it's a non-issue now since the client has just informed me that the deposit didn't take place after all!

[mbozek]

Is this a corp plan? If so how will the plans sponsor be able to claim a deduction if another party makes the contributon? There is no prohibition against another person making the contribution, but the employer's deduction will be disallowed.

[GBurns]

What?? .."the client has just informed me that the deposit didn't take place after all! ". Do you really mean that the client was not originally able to look at the cancelled check and the account statements and determine where the check had been used? Fishy!