Failure to Auto Enroll - QACA Plan

[52626]

Employer has an auto enrollment at 3%. Safe Harbor Match is 100% up to 5%. Just discovered some participants in 2013 were never auto enrolled.

Do I calculate the missed deferral as 3% of the wages

then the missed deferral opportunity is 50% of the missed deferral this is a QNEC made by the employer

the match is 100% up to 5% of comp - so the match would be calculated based on the missed deferral amount. - This is a QNEC made by the employer

obviously lost income needs to be calculated.

thanks

[QDROphile]

The IRS recently accepted this approach in a VCP filing under Rev. Proc. 2013-12. Rev. Proc. 2013-12 does not say for sure; the IRS has requested comments on how to correct such a faliure.

[401king]

The match would be a QNEC? If it were discretionary would it still be a QNEC?

[BG5150]

The match would be a QNEC? If it were discretionary would it still be a QNEC?

OP says it's a SH match.

[401king]

The match would be a QNEC? If it were discretionary would it still be a QNEC?

OP says it's a SH match.

I know it's an unnecessary detail here, but wouldn't the Missed Match be carried as a Match contribution (safe harbor or discretionary, whichever applies) as opposed to a QNEC? In the case of a missed discretionary match it may affect vesting/distributions.

[BG5150]

The OP says it's a SH match. There is no way the govn't would let you put a vesting schedule on a missed SH match.

I agree that the made up match (SH or regular) is NOT a QNEC and would be considered a match however the terms of the plan defines it (stated, discretionary, SH, SHQACA, etc)