401k withholding post calendar year end

[CLE401kGuy]

Participant is age 50+

On 3/11/15, he's asked if there is any way to go back and do the catch-up elective for 2014 at this time

Since the calendar year is long ended, and he's already rec'd W-2 - could the employer withhold now and issue an updated W-2?

The participant is an employee at a C-Corp

My answer is no - just seeing if there is anything creative I could recommend outside of indicating the participant should just increase his elective contribution % for the 2015 year

[K2retire]

Is the employer going to also issue a back dated pay check from which to make the contribution?

[CLE401kGuy]

If the employer was willing to do this, could that open up the possibility? My guess is they will not - but the employee is considering an exec level associate I believe....

[Bird]

no, no, no

[david rigby]

Does this look like fraud?

[hr for me]

My answer would just be no and I would be even more concerned if it was an HCE who got a benefit. While IRAs do allow for late contributions up until tax filing time, 401k's do not.

[John Feldt ERPA CPC QPA]

For 2014, before they ran out of time in the year to have enough wages left to be paid in order to even make such an election, did the employee fill out a deferral election that said something like this?

"I elect to defer from my compensation the largest possible amount for each calendar year as permitted under 402(g), including any catch-up deferral if applicable."

If they made such an election, and they still had enough wages left to be paid in the year when they made that election, then the plan has a failure to follow the employee's written deferral election. See Revenue Procedure 2013-12 (probably a 50% QNEC by the employer for the missed deferral).

Otherwise, HCE or NHCE, either way, if there's no concern about committing tax fraud, then why bother to even issue a Form W-2 in the first place, and why bother with getting written deferral elections in place prior to withholding such deferrals?

[coleboy]

I have a similar question. The CPA, after reviewing the client's Sched. C, wants to know if she can put in any additional deferral amounts now for 2014. Is it possible. My first thought is no.

[Bird]

What did the Schedule C taxpayer elect to contribute before 12/31? That is what she can/must deposit.

[coleboy]

She put in slightly less than $23k as she was eligible for catch-up.

[K2retire]

If her deferral election said $23,000, she should be able to make up the difference so long has her Schedule C is high enough and she does it before April 15.