Guest rgorman Posted February 12, 2004 Posted February 12, 2004 Safe Harbor 401(k) plan using basic match formula (100% on 3% and 50% on next 2%). Match is calculated per pay. Payroll provider calculated match incorrectly for a NHCE that was deferring a flat dollar amount not a percentage. Only one participant was affected and it was not incorrect on all payrolls. Would this cause it not to meet the safe habor and be subject to the ADP and ACP test? Or could a correction be done for the match for the one participant? Any ideas on correction method? Thanks ahead of time !
Brian Gallagher Posted February 13, 2004 Posted February 13, 2004 I don't know of anything that says you have to make the match right away. Can't you do a type of true-up and allocate earnings for the match that was missed? I think you have until the end of the next year to make the contribution. Remember: two wrongs don't make a right, but three rights make a left.
Guest rgorman Posted February 13, 2004 Posted February 13, 2004 Thanks, I know that is true with an annual match but I was not sure on a per pay match since match for everyone has been contributed and we would just be adding the fix for the one person.
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