DOL 401k Deposits Safe Harbpr

[austin3515]

The reg says

(2) Safe harbor. For purposes of

paragraph (a)(1) of this section, in the

case of a plan with fewer than 100

participants at the beginning of the plan

year, any amount deposited with such

plan not later than the 7th business day

following the day on which such

amount is received by the employer (in

the case of amounts that a participant or

beneficiary pays to an employer), or the

7th business day following the day on

Pay-Day is 2/5/2010, which is a Friday.

Don't count Saturday or Sunday (6th and 7th).

Day 1 = 8th (Mon) (first business day following the date on which it was withheld)

Day 2 = 9th (Tues)

Day 3 = 10th (Wed)

Day 4 = 11th (Thurs)

Day 5 = 12th (Fri)

Don't count Saturday or Sunday (13th and 14th).

Day 6 = 15th (Mon)

Day 7 = 16th (Tues)

Is this correct? The reg say

[GMK]

Does it matter that Feb. 15, 2010, is a federal holiday?

[Guest Sieve]

I think a federal holiday is not considered a business day. But, does anyone know where "business day" is actually defined? Is it only weekdays, for example--regardless of when the employer is open to the public?

[K2retire]

I've never seen it defined, but have always assumed that for this purpose a business day was a day on which it was possible to conduct a banking transaction.

[austin3515]

Believe it or not, my client is open BUT of course the banks are closed today.

Nevertheless, the point of my question had more to do with whether or not I began counting on the right day. i.e., the day AFTER pay-day is day 1. Pay day does not count as day 1.

Does everyone agree with that interpretation?

[Guest Sieve]

Yes. Counting always starts with the next day, i.e. the day after the event (payday, posting/distributing a notice, etc.) occurs.

And, K2, I agree with you--I always thought a business day was a weekday that banks were open, thus excluding national/state holidays and not including weekends (even if you can conduct some banking transactions on Saturdays and, in some instances, on Sundays). But, why did I think that? And, why, I wonder, does EBSA use that term in the new plan asset regs without pointing to a definition or even discussing it in the preamble to the proposed or final regs?

[masteff]

And, why, I wonder, does EBSA use that term in the new plan asset regs without pointing to a definition or even discussing it in the preamble to the proposed or final regs?

Possibly because it's defined in 29 CFR Part 2510.

http://ecfr.gpoaccess.gov/cgi/t/text/text-...6.9&idno=29

(e) Definition. For purposes of this section, the term business day means any day other than a Saturday, Sunday or any day designated as a holiday by the Federal Government.

[Guest Sieve]

Thanks, masteff. I kinda embarrassingly missed it, ehh? Right in the "plan asset" regs--even before the recent revision! No wonder it wasn't mentioned in the preambles . . .

[masteff]

I was just coming back to edit my post because I noted that the newly published regs elipsed out several paragraphs, including (e). If they can waste several pages w/ their over-long discussion, you'd think they could have spared a little more ink to keep the section in full context!