ADP Test and Hardship amounts

[cpc0506]

Participant A took a hardship and Employer did not stop deferrals as required.

I know that the deferrals need to be returned to the participant, but are the deferrals included in the ADP Test?

[Lou S.]

HCE or NHCE?

I think the answer is different depending.

If it was an HCE you include the,

If it is an NHCE you exclude them.

[Tom Poje]

my guess would have been they are not counted at all. they are a 'mistake' - if you are self correcting you are putting a plan in a position as if the error hadn't occurred. this is different than if there are excess deferrals in which the regs clearly spell out what is to be done.