Miscoded Deferrals

[Dazednconfused]

Company mistakenly 'mis-coded' some participnats salary deferrals and they were not funded along with the associated match (match on a vesting schedule) for more than half the year.

Since this has happened some of these participants have left. Some of these corrections are around $10 in deferral and match, everything I read says they will need to fund, however, they may be able to FF the amounts because they are under $75 under the corrective distribution, is this on the right track? Also, when the ER makes up the deferral and match, should they fund as a deferral or QNEC and match or QMAC?

Thanks all

[ETA Consulting LLC]

Not clear on your fact pattern. Was an election to defer not honored? Or, were deferrals made but merely not deposited to the trust? If deferrals were withheld and not deposited to the trust, then it is clear that those plan assets must be deposited promptly and the match must be made (regardless of how small). It is a relatively simple correction for a small oversight, but tends to be more inconvenient than technical.

If it was merely an election that was not honored, then there is a different train of thought leading toward letting sleeping dogs lie.

Good Luck!