Missed Match versus True-Up and related Earnings

Client found that their payroll system was not accurately calculating match for employees participating in Catch-Up. The correction should be to make up the missed match along with any earnings, correct? And there is no waiver or anything (Similar to missed deferrals caught early enough to avoid the need for a QNEC) that exists for match, is there?

That said, if they do not correct this during the year, these employees should be made whole when the company funds their year-end match true-up. I have never seen these include earnings.

Is there any reason for this and is there anything the client should consider before choosing one option versus the other? If "correcting" this with the true-up and not funding earnings an issue? Is there a reason that this should be done with earnings because it violates any rule?

The client is the one who brought this up as they don't see why it should matter how they do it as long as they do and I want to make sure I explain what they're missing, if anything.

Thanks!

RTFD. Unless the document says otherwise (and I don't know why it would), matching contributions are due at the same time as an employer nonelective contribution. An employer contribution made after the end of the plan year is not late, as long as it's made by the taxpayer's filing due date, plus extensions, so no lost earnings are due. A matching contribution made after the end of the plan year is not late, as long as it's made by the taxpayer's filing due date, plus extensions, so no lost earnings are due.

And yes, the matching contributions need to be made. There's no waiver. Different situation from missed deferrals. They can deposit it now or as part of the true-up.

The due dates for matching contributions is not the same as those for employee deferrals.  If the match is based on the Plan Year with a true-up and not the payroll period, then the due date for depositing the match as EBP described above.  

If the match is based on the payroll period with no true-up, then the match must be deposited quarterly. 

ConnieStorer - thanks for the clarification about quarterly deposits.

Isn't that just the rule for *safe harbor* pay period matches?

Agree if (i) the plan document states a plan year match with true-up rather than a per pay period match with true up and (ii) this occurred with all participants.  It appears that this happened with all participants, but if instead it involved just a portion of the eligible participants arguably that match would need to be contributed at the same time the participants who received the match received their match.  Otherwise, the plan sponsor could be administering the plan differently for one group of participants than another similarly (identically?) situated group of participants.  Treating the participants differently could raise fiduciary duty issues.