One-to-One QNEC allocated "to the account balances" of NHCEs

[John Feldt ERPA CPC QPA]

Under Revenue Procedure 2013-12, in Appendix B, Section 2.01(1)(b)(iv)(B)(1), it states "the contribution ... is allocated to the account balances of ..."

Later in that same paragraph, three more times it states "to the account balance(s)"

Under this One-to-One correction method, could a plan sponsor allocate the QNEC only to eligible NHCEs that have account balances (meaning the Eligible NHCEs with a zero account are excluded)?

[ETA Consulting LLC]

You could, likely, get this through during a VCP submission as a slight modification to the recommended approach. But to interpret "to the account balances" as meaning "to only those NHCEs who have account balances" would appear to undermine the correction principle.

Good Luck!

[John Feldt ERPA CPC QPA]

That's how I would interpret it, but of course, that's not what the employer is looking for : (

[ETA Consulting LLC]

I think we've all been there