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IRS releases updated 401(k) Plan Mistake and Fix It Guide

September 04, 2014

The Internal Revenue Service (IRS) has released an updated and enhanced 401(k) Fix It Guide for employers. The guide was updated by the IRS in June 2014 and can be found at: http://www.irs.gov/pub/irs-tege/401k_mistakes.pdf

Retirement plan mistakes can easily happen, but they are often costly. The IRS Fix It Guides will show you how to correct plan mistakes in the most cost effective manner. If you believe you have a Retirement Plan mistake on your hands, contact a Leading Retirement Solutions team member, today at office@leadingretirement.com or (800) 974-2814.

Leading Retirement Solutions loves the 401(k) Plan Fix It Guides prepared by the Internal Revenue Service. The IRS Fix It Guides are designed to communicate in the most common terms, certain correction programs that are available to employers when they don’t operate their 401(k) Plan pursuant to regulations. The 401(k) Fix It Guide details how to find plan mistakes, how to fix plan mistakes and how to avoid plan mistakes in the future.

The updated and enhanced 401(k) Fix It Guide provides helpful information for the following Retirement Plan mistakes that commonly occur when operating, managing and maintaining a 401(k) Plan:

  • Your plan’s legal documents have not been updated in a few years
  • Failure to run the plan in accordance with the terms of the plan document
  • Failure to use the plan definition of compensation correctly for all deferrals and allocation
  • Employer contributions weren't made to all appropriate employees
  • The plan failed the 401(k) ADP and ACP nondiscrimination tests
  • Eligible employees weren't given the opportunity to make an elective deferral
  • Failure to adhere to the 402(g) contribution limits
  • Failure to deposit employee contributions on a timely basis
  • Failure to make or administer plan loans in accordance with legal requirements or the plan document
  • Hardship distributions weren't made properly
  • Required minimum contributions weren't made to a top-heavy plan
  • Haven’t filed a Form 5500, timely

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