Failed ADP - Participant Deceased

[PFranckowiak]

Plan fails the ADP test. Money needs to be returned to HCE.

HCE is deceased. (Died late 2011)

Who does the excess get paid to? (I.e. what SS# should the 1099 be for?)

Thanks

Pat

[ETA Consulting LLC]

The excess should be paid to his beneficiary under the plan.

Good Luck!

[FormsRstillmylife]

Excess funds cannot pass through the plan beneficiary designation. Refund to the estate under the deceased's social Security number. Otherwise you are setting the beneficiary up to contaminate an inherited IRA.

[PFranckowiak]

Thanks - not in an IRA yet - still in the plan. The spouse is the beneficiary so do we pay her the money and 1099 the deceased?

Pat

[ETA Consulting LLC]

When the participant dies, the plan beneficiary becomes entitled to all assets in the participant's account. The only thing the excess does is to say that these funds are not allowed to remain in the plan. On what authority would you distribute to anyone other than the designated beneficiary.

Good Luck!