True-up Question - Safe Harbor Match

[metsfan026]

I know if someone is funding the Safe Harbor Match on a payroll-by-payroll basis, a true-up is not required.  However, what happens if someone is inadvertently overfunded?  Does that money need to be pulled from the account or since it's on a payroll-by-payroll basis no adjustments are needed?

Thanks in advance!

[401king]

An overfunding should be treated as a Correction, rather than a True-Up. 

[metsfan026]

OK, so pull out the overages and move them to the Forfeiture.  Thanks!

[Mr Bagwell]

I would suggest this is not a forfeiture, but rather something that should probably go to an unallocated account and used up as soon as possible.

[austin3515]

You could consider it profit sharing if there was an objective of not taking money away from someone. Subject of course to any allocation conditions and nondiscrimination.  Obviously if there is a vesting schedule on profit sharing etc. you'll want to move the money to their profit sharing money type.

We've been pretty accomodating to clients who do not want to take amounts (especially small amounts) away from NHCE's.  I know if we had overfunded someone's account by $100 I would not want to go to that person tell them I screwed and take $100 from them. Most (but not all) of my clients have shared that sentiment...