402(g) vs 415 Excess-Which is first?

[justatester]

First off, I realize this should not happen, but it has so now I need to fix it.

2012 Plan Year

Participant Contributions $20,000 in pretax...Not catchup eligible. They receive a $40,000 ER contribution. (This is a Taft Plan so multiemployer.)

Which Excess do I correct first? Do I reduce the $20,000 to $17,000 and then remove an additional $7000 for pretax for the 415 failure?

The difference if done by April 15th, 402g would be taxable in year contributed. If done as all 415 excess, all would be taxable in year distributed.

Any thoughts?

[Tom Poje]

the person is not catch up eligible, so 3000 is excess deferral.

everything else is 415 violation. shouldn't matter what source you take it from.

but depending on how the document reads, it could well be the person has 17000 in deferral and 33000 in ps as that should have been capped to avoid not following the document properly.

(e.g. document may have restrictions)

see the following write up

http://www.relius.net/News/TechnicalUpdates.aspx?ID=657

[justatester]

I was thinking 402g first ($3000) since that is reported on the w-2s. Then in this plan's case..it would be pretax first (No aftertax in plan).

[QDROphile]

I thought source matters in an EPCRS correction of a section 415 violation.