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.
Over the next few weeks 401kBasics is going to review the common mistakes that plan sponsors make in administering their plan, how to find the mistake and chow to correct the mistake. The first common mistake is failing to update your plan document with regulatory law changes.
- How to Find the Mistake: Review annual cumulative list published close to year-end to see if the plan made all required law changes.
- How to Fix the Mistake: Adopt amendments for law changes through the VCP or Audit CAP, depending upon the situation.
This mistake can be avoided in the future by utilizing a calendar that notes when you must complete amendments, review your plan document annually and maintain regular contact with the company that sold you the plan. For more information please refer to potential mistake number 1 on the IRS 401(k) Fix-It Guide.
This site is for entertainment purposes only. 401kBasics and it’s authors are not financial advisors and no information found on this site should be construed as financial advice.