Correction under EPCRS

[austin3515]

When can a contribution be deducted under EPCRS? Correction is to make up missed deferralks due to not implementing an employee's election. Ideally, we could deduct in 2010, because a) the missed deferrals relate to 2010, and b) they will be funded by the due date of the employer's return.

Any help appreciated.

[DMcGovern]

Basically, if the amounts deposited are to make up contributions required under the plan, they are treated as contributions. If they are to make up lost earnings or are the result of breach of fiduciary duty (See Rev rul 2002-45), they are not treated as contributions under the tax code.

EOB also has helpful information on this in Chapter 13B, Section III, Part F.1; also see the comment box in Chapter 15, Section VI, Part B.6