- Failure to amend the plan document for tax law changes by the end of the period required by law
- Failure to follow the plan document’s definition of compensation for determining contributions
- Failure to follow the plan document’s eligibility provisions
- Failure to satisfy IRC Section 401(a)(9) minimum distributions
- Failure to follow the in-service distribution provisions of the plan document
- Failure to provide correct distribution forms, make timely distributions and prepare correct tax reporting of distributions
- Failure to follow the plan’s vesting schedule
- Failure to retain records
- Failure to maintain internal controls
- Failure to follow the terms of a qualified domestic relations order (QDRO)
- Failure to satisfy IRC Section 415
In addition to the Common Trends outlined above, 401(k) plans have unique characteristics that impact the operation of these plans and EPTA audits have focused on the following trends, including ADP/ACP failures, matching formula interpretations, and automatic enrollment procedures.
· Failure to correct the ADP/ACP nondiscrimination failures under IRC Sections 401(k) and 401(m)
· Failure to apply to matching formula properly
· Failure to follow the maximum deferral percentage under the terms of the Plan
· Failure to follow the terms of the automatic enrollment language under the terms of the Plan and/or PPA '06
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