The Importance of Timely Remittance of 401(K) Deferrals
Posted on 01.23.13
Author: Courtney S. Barrack, CPA
For small businesses who think timely remittance of employee deferrals to a 401(k) plan is unimportant, think again. This week the Department of Labor ("DOL") announced a Virginia Beach company has been ordered to restore 401(k) funds held as far back as January 1, 2007 and pay a civil penalty of more than $15,000.
The Employee Benefits Security Administration ("EBSA"), an agency of the DOL, through its enforcement of Title I of the Employee Retirement Income Security Act of 1974 ("ERISA"), protects the security of retirement and health plan benefits and assets for all workers who have employer-sponsored plans. This judgment is one example that they are indeed addressing such issues aggressively.
As noted in the DOL's strategic plan, "EBSA seeks to correct violations of ERISA through an aggressive enforcement program integrated with an effective participant assistance program. EBSA will partner with worker and community-based organizations to identify violations and to educate workers, small businesses, and others about the requirements of ERISA, which EBSA believes is an effective way to create broad-based compliance."
Should you have any specific questions about the requirements of ERISA, feel free to contact Courtney Barrack, CPA, or your Keiter client service professional for further clarification.