401(M) and ACP test; what do you do if the plan does not pass muster?

[Guest Enda80]

What do you do if the plan does not pass the ACP test? How does 401(M) come in?

[Tom Poje]

same as ADP test. provide QNEC or QMAC to pass testing

refund $ (plus earnings) to HCEs (or forfeit if not 100% vested)

er pays penalty tax if distribution not timely made.