Each Monday 401kBasics posts a new tip as a part of our series “Plan Sponsor Quick Tips”. This series is designed to assist plan sponsors in filling their fiduciary role and running their retirement plan efficiently. Your feedback or suggestions on future articles is welcome.
After the year ends, plan administrators are responsible for preparing the census requirements and in certain cases a questionnaire as well. These documents communicate the details of the plan and the participants to assist the service provider in annual nondiscrimination testing and filings. As we approach year end, taking the following steps will put the plan administrator in good shape to complete these requirements:
- Ensure that all participants who became eligible during the 2010 plan year, regardless of whether they chose to participate, are on the census file.
- Review the plan’s definition of compensation, to ensure that it is accurately reported and the appropriate elements are excluded and/or included.
- Determine how hours of service are calculated (elapsed or actual).
- Review the plan documents to help you in completing the questionnaire.
The census and questionnaire should be completed as soon as possible after the year ends. As always, contact your service provider to see what other steps can be taken to assist in preparation for the year end.
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