EACA Plan - changing Default Percentage after 1/1/

[52626]

Client has an EACA Plan with 3% default Not a Safe Harbor Plan. They want to increase the percentage to 4% and also increase the cap on the auto escalation. They want the changes effective 1/1/2017.

The platform has notified us that they can not get this change implemented before the end of the year, and therefore the client has to wait until 1/1/2018. Per the platform you can not make changes to the EACA mid year.

I thought I read you could change the EACA mid year, however it would only apply to new participants. However, since the EACA will not be a uniform percentage for the 12 months, the client may lose the ability to correct ADP refunds by 6/30 - they would have to have refunds issued by 3/15 to avoid the excise tax.

Was I dreaming this or is my thinking correct. If I am correct, where can I fund documentation to support this position???

[rcline46]

Bad platform! They should be able to amend the plan and make any system changes between now and 12/31. Put more pressure on them, up to and including terminating services

[K2retire]

Bad platform! They should be able to amend the plan and make any system changes between now and 12/31. Put more pressure on them, up to and including terminating services

They should -- but many of the won't.