4 months of 401K deductions have not been put into the 401k plan. What

[Guest stinnett2000]

This has been an ongoing problem for almost a year now. My company takes out money from my paycheck for my 401K and it takes on average 60-90 days after the end of the month it was deducted from before it shows up into the plan.

As of today my last deposit was from September 1999. Now my company is in serious financial problems and I laid off last week. I asked about the 401k missing deposits and my HR manager said this "As you know the company is having financial problems.. once they company has caught up on their bills they will then deposit the 401k money." So it is plainly clear that they are using our 401k deductions to pay their bills and not put it into our 401k plan. I have already told the HR manager that I was informed she has 15 days after the end of the month to make the deposit and she says I am wrong.

What recourse do I have to recover interest on this money deducted? If the company files bankruptcy as it appears they will, what will happen to the last 4 months of money I had deducted from my paycheck?

Who do I need to contact about this? The DOL? The IRS? Any other organization?

Any help or information would be greatly appreciated! Thanks!

[RCK]

Ouch.

You were generally right with your comment to HR, that they had 15 days after the end of the month of the deduction to get the money deposited. Even that is not a safe harbor-- the IRS would apply a facts and circumstances test to see if the contributions should be made even faster than that.

One of our subsidiaries sponsored a plan that had some administrative issues, and the agency that I thought responded best to the participant's needs was the regional DOL office. THe Department of Labor website is at http://www.dol.gov, and through the contact us section you can find out which region you are in and what their number is.

I would suggest moving quickly before all the money is gone.

[Guest William Hoversen]

In addition to the DOL, you might want to contact a private attorney, as the scenario you have outlined smacks of a breach of fiduciary duty. I do agree, however, that whatever you do should be done quickly.