Top Heavy PSP - employer failed to make required contribution to NHCEs

[Guest Jaym32]

This happened for 2008. I wrote to DOL, they were interested and helpful but ultimately referred the matter to IRS. And to my knowledge that was the end of it, almost 2 years ago.

Does anyone know of an airtight case history where a top-heavy PSP sponsor just refused to make the required contribution for NHCEs and got called out for it? Thanks!

[Jim Chad]

Around 2004, (I think) I had a Plan audited by the IRS. they had made the Th for everyone who met the 1 year eligibility for PS. But they let people defer after 90 days. They were told by the IRS auditor they had to make the TH for these people or the plan would be disqualified.

[mschwechter]

The ultimate penalty is plan disqualification, if caught.

http://www.irs.gov/Retirement-Plans/Fixing-Common-Plan-Mistakes---Top-Heavy-Errors-in-Defined-Contribution-Plans

I had an employer who failed to make the safe harbor match for 3 years, I ultimately fired the client.