Ineligible PS received & distributed

[Dazednconfused]

Hi,

Participant received an ineligible profit sharing contribution, terminated and received distribution that included ineligible ps contribution amount. The ps account had a loss by the time money was withdrawn.

I can try and get the money back from participant (it was a rollover, which might make it somewhat easier...) and if that fails the employer, I believe has to 'make the plan whole'.

However, at which amount to must I try and return to the plan? Say the ineligible contribution was $1,000 and the loss was $200, do I return the original $1,000 from participant or the $800 from the participant then the ER makes up the $200 loss amount so that the total is returned? Or perhaps only the $800, since that what would have been forfeited at the time of the distribution?

Thanks,

Jason

[david rigby]

Participant received an ineligible profit sharing contribution ...

Is the Plan "in the hole"?

[Dazednconfused]

Participant received an ineligible profit sharing contribution ...

Is the Plan "in the hole"?

ha! No not in the hole, just a bad year for investment

J