Late profit sharing contributions

[Guest terric]

If a profit sharing plan has a discretionary profit sharing contribution, and the employer intended on making a contribution but didn't deposit the contribution on time, what are their options (if any)? Can they deposit the contribution late and just not take the deduction for it and still allocate the contribution to the participants?

[Archimage]

The contribution is to be deposited by the due date of the tax return. If the due date has already passed then there is nothing he can do.

[R. Butler]

I'm not aware of any requirement that contributions for the year in which they are allocated.

When was the filing deadline? Its been awhile since I looked at the issue. I do seem to recall that as long as the contribution was made within 30 days of the due date of the tax return, that contribution would be an annual addition for the prior taxable year, employer would just have to deduct in the year made.

[Archimage]

Now that you mention it, that does sound familiar to me too. I believe there is a regulation under 415 that is interpreted as giving 30 days after the 404(a)(6) due date. As R. Butler said though, the contribution would not be deductible for the same year.

[Blinky the 3-eyed Fish]

This question came up a few days ago. See here:

http://benefitslink.com/boards/index.php?s...=0entry102267

[Guest curmudgeon]

Actually it depends. The annual additions deadline does not necessarily correspond with the deadline for deductions. What kind of entity, plan year, and to what date was the return extended? For example, a 12/31 c-corp can miss the 09/15 deduction deadline, contribute by 10/15, and the contribution is still an annual addition for the previous year. The deduction just has to be taken the following year.