The new Revenue Procedure 2015-28 addresses the concerns that employers who sponsor 401(k) and 403(b) plans have with using automatic enrollment and escalation, which can increase the chance of missing an employee’s elective deferral. The Revenue Procedure includes a safe harbor period that extends the length of time the employer has to correct the error. However, the safe harbor period is not applicable if the employer receives notice from the employee of the mistake.
See Kenneth A. Mason, IRS Eases Correction Rules for Missed Elective Deferrals, Spencer Fane, Apr. 6, 2015.
Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.
