Is testing necessary if plan satisfies QACA?

[taxllm]

I cannot find authority saying that the ADP/ACP test must be run if the plan used the prior year data even if it adopts QACA. Anybody can point me to it? TPA says they must run the test even if plan satisfies QACA.

[rcline46]

QACA changes the plan to current year testing since it is a version of a Safe Harbor.

ADP/ACP testing is run to determine if anyone failed the 402(g) limit (or other imposed limit), make sure people deferred the correct amount, and to make sure the correct matching contributions were made.

So yes, the tests must be run to assure compliance.

[BG5150]

ADP/ACP testing is run to determine if anyone failed the 402(g) limit (or other imposed limit), make sure people deferred the correct amount, and to make sure the correct matching contributions were made.

That is more data verification than testing. For calendar year plans, I can just look at my data to see if anyone went over 402(g). And some (usually) simple spreadsheet calculations will show me if the match is off.

Although, you can run the data through the ADP/ACP testing program to catch failures easier.

[QDROphile]

Mistaking tules for rools.