"The max deductible contribution for a Cash Balance is: Funding Target + Normal Cost + Cushion Amount (Funding Target /2) - Assets. I have that correct, right?"

"This seems to be landing as follows: [1] When mandatory auto enrollment is being added to a plan that was effective before the EACA was effective, a 'sweep' is not required. This can happen when either [a] new plans established after 12/29/2022 with auto enroll mandated 1/1/2025; OR [b] when a new plan is not subject to auto enrollment right away because of the <10 Employee exception and the new business (3 year) exception. [2] When mandatory auto enroll applies to a new plan on the effective date of the Plan, a sweep is required. The law is less clear to me here, but if a Plan's Elective Deferrals are effective 7/1/2025, then there must be an active EACA on that date. So everyone's plan entry date is 7/1/2025 and if no one is enrolled on 7/1/2025 then the plan did not include an EACA on 7/1/2025. That part I think is straightforward enough regarding why a sweep being required makes sense.

"I had suggested in one conversation limiting application of the EACA to people who would have become eligible on 7/1/2025 even if the Plan was effective years ago but no one liked that idea (and thus not doing a sweep). I personally think it works but I don't want to go too rogue. I am somewhat surprised that there is not a lot more conversation and a lot more articles on this very topic. This is going to be front and center really now as we establish new plans. I am curious to know if anyone has come to these same conclusions or something different. Too bad the IRS is letting us squirm without any guidance. To me, to sweep or not sweep is the most important question facing our industry today. Please discuss!"

"Client with calendar year 401(k) plan and fiscal year C Corp (1/31). The client (one man plan) made a 45k in December of 2023 which the accountant is deducting for fiscal year end 1/31/2024 and then a $30,500 contribution at the beginning of January of 2024. The accountant says it was his intention to process a payroll in January of 2024 which he never did. I am inclined to call it commingling of corporate assets with plan assets from the beginning of January till February 1. 2024 and deduct it in the fiscal year ending 1/31/2025 calling it a prepaid contribution. They just processed the clients 401(k) deferral for 2024. It is my understanding you can not prepay a 401(k) deferral. Does anyone have another idea about how to handle this contribution?"