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How Can We Tweak Our Plan's Eligibility Requirements to Make Administration Easier?

DWC 10/20/20
Facts We’ve sponsored our 401(k) plan for several years now, and it’s been very well-received by our employees. Believe it or not, though, one of the biggest challenges we have had is around when employees become eligible. Some of our staff are salaried, while others are hourly. We have both part-time and full-time employees, and we are also ...
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Should We Include Government-Mandated Coronavirus PTO When Calculating Company Contributions?

DWC 04/21/20
Facts We have several employees who have had to take time off from work either because of a loss of childcare or to care for affected family members due to the coronavirus.  As a result of recent legislation, they qualify to receive compensation during their leave from work.
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Are Missed Deferrals and Late Deferral Deposits the Same Thing?

DWC 05/14/19
Facts Our company sponsors a 401(k) plan.  One of our newer employees, Jane Smith, met the eligibility requirements and should have joined the plan on January 1st.  Due to an oversight, we forgot to enroll Jane in the plan until she asked about it a couple months later.  We assume that we need to make some sort of correction, and we’ve done some ...
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Who are Leased Employees & Are They Eligible for my 401(k) Plan?

DWC 04/16/19
Facts I own a small manufacturing company that specializes in office supplies, and I sponsor a 401(k) plan for my employees. One of my former employees, Tim Halpert, worked full-time with me for the past several years but recently left to work for a staffing agency called Prestige Worldwide.  Tim was a great employee for many years, and Prestige ...
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How Do We Correct Missed Deferrals for New Hires?

DWC 07/31/18
Facts Our 401(k) plan allows new employees to make contributions on the first day of the quarter after they work for us for a year.  All of our full-time employees have been with us for a long time.  Most of our new hires are for short-term projects, so they almost always terminate employment in less than a year and never become eligible for our ...
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Correcting a Failure to Withhold Deferrals from Eligible Compensation

DWC 06/28/18
Facts ABC Company maintains a 401(k) plan that includes the following provisions: It operates on a calendar year. Compensation is defined as W2 wages with pre-tax deferrals added back and no exclusions. Eligible participants can defer up to the IRS limit $18,500 + $6,000 for those age 50 or older (2018 limits, indexed for inflation) The company ...
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The views expressed in this blog are those of the authors and do not necessarily represent the views of any other person or organization. All content is provided for informational purposes only and is not intended to be tax or legal advice.