Quarterly Insights

Legislative News and Updates

Effective for plan years beginning on or after January 1, 2023, the Department of Labor has updated the participant counting method that determines whether 401(k) and 403(b) plans require an audit.
Previously, plans with over 100 eligible employees and terminated participant account balances on the first day of the plan year would require an audit.
Under the new rules, only the account balances of both active and former employees count towards the 100-participant audit threshold.

For example, say a plan has 125 active employees, 15 active participants with an account balance, and 5 terminated participants with a balance.
Under the old audit requirements, this plan would need an audit since there’s over 100 eligible and terminated account balances.
Under the new audit requirements, this plan no longer requires an audit since there are only 20 account balances.

Important Deadlines:
January 31: Many recordkeepers require participant data for average deferral percentage (ADP)/average
contribution percentage (ACP), top-heavy and 402(g) compliance testing to be returned by this date.
February 14: Deadline for participant-directed DC plans to provide participants with quarterly disclosure statement
and statement of plan expenses actually charged to individual plan accounts during Q4 of 2023.
March 15: Deadline for distributing ADP/ACP refunds without incurring a 10% excise tax on the employer – i.e., due
2 1/2 months following plan year-end. Note: Not all deadlines mentioned above are required for each retirement
program. Ask your Alliant Retirement Consultant today which ones apply to your Plan.

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