Incorrect deductions for 1/2 year for Simple IRA

[DR245]

I'm not sure this is a valid issue but given my history with our company's SIMPLE debacle from 2020, I wanted to cover my bases.

We hired a new accountant for Q422 and they used the wrong election form for my 2023 deductions.  I chose 4% for the past two years and they used my 2021 election form which was a 3% match.

I realized this after my 6/15/2023 check (due to other issues with our FLEX program) and brought this to their attention.  They decided to make up for this difference by adding the missing amount to the next 11 checks until all missed deduction amounts are accounted for.

My question:  Is this the proper way to do this (or perfectly ok) or does the company need to go through a proper correction method (i.e. VCP)?

Thanks!

[Gary Lesser]

It would be more prudent to fix the entire issue at once with interest calculated using the DOL Online VFCP Calculator available at https://www.askebsa.dol.gov/VFCPCalculator/WebCalculator.aspx. If Lost Earnings are paid on the Recovery Date, leave the Final Payment Date blank.

[DR245]

There was a definite sense of animosity during this last issue with the company and this appears to be an honest mistake and only effected 6 months of pay.  Does prudent mean it's a sensible/responsible fix but not absolutely necessary or is this the type of administrative error that HAS to be done through a VCP?

Thanks!

[Belgarath]

No, VCP is not required. But Gary's advice is good!