Prefunding Balance elections

[My 2 cents]

Looking for affirmation here:

A client signed an election in the second half of September 2009 to add a portion of the excess 2008 contribution to the Prefunding Balance as of January 1, 2009, which was immediately used in part to cover some of the 3rd or 4th quarterly contributions (due 10/15/09 or 1/15/10) and overall minimum for 2009 (due 9/15/10). Assume that they had a proper filing extension to 10/15/09 for the 2008 5500 filing.

1. The proposed regulations gave until the filing deadline for the relevant 5500 to make such an election.

2. The final regulations, effective as of 2010, only give until the payment deadline for the year with the excess contributions. Anybody have an idea why they would have done that? Pretty much precludes (absent a standing election) grabbing any excess portions of a last-minute contribution. Or is that the reason?

3. The election made in late September 2009 to add to the Prefunding Balance as of the beginning of the 2009 plan year is thus valid.

Incidentally, any word on when (if?) the IRS is going to allow standing elections to use Carryover/Prefunding balance to cover quarterlies?