401(k)401(k)PlanPlanChecklistChecklist

This checklist isn't a complete description of                              For Business Owner’s Use 
all plan requirements, and shouldn't be used as                             (DO NOT SEND THIS WORKSHEET TO THE IRS) 
a substitute for a complete plan review. 
Every year it's important that you review the requirements for operating your 401(k) retirement plan. Use this  
checklist to help you keep your plan in compliance with many of the important rules. For additional information  
(including examples) on how to find, fix and avoid each mistake, click on "(More)." See www.irs.gov/retirement  
and click on "Types of Retirement Plans" for Fix-It Guides and other resources for 401(k) and other plan types.                  

1. Has your plan document been updated                           7.Are elective deferrals limited to the  
within the past few years?                                       IRC Section 402(g) limits for the calendar 
                                                                 year?
If your plan hasn't been updated to reflect recent law changes,  
the plan needs to be revised.                                    Failure to distribute deferrals in excess of the 402(g) limit may  
(More)                                                           result in additional taxes and penalties to the participant and  
                                                                 employer.  
2.Are the plan operations based on the                           (More)
plan document terms? 
Failure to follow the terms of the plan is a common problem      8. Have you timely deposited employee
                                                                 elective deferrals?
found on audit.   
(More)                                                           You should deposit deferrals as soon as they can be 
                                                                 segregated from the employer’s assets. 
3. Is the plan’s definition of compensation                      (More) 
for all deferrals and allocations used 
correctly?                                                       9. Do participant loans meet the plan
                                                                 document and IRC Section 72(p)
Your plan may use different definitions of compensation for  
                                                                 requirements? 
different purposes. It's important that you apply the proper  
definition found in your plan document.                          Defaulted loans or loans in violation of IRC Section 72(p) may 
(More)                                                           be treated as a taxable distribution to the participant  .
                                                                 (More) 
4.Were employer matching contributions
made to appropriate employees under the                          10.Were hardship distributions made
plan terms?                                                      properly?
The plan terms must be followed when allocating employer         If a plan allows hardship distributions, the plan terms must be  
matching contributions.                                          followed.  
(More)                                                           (More)

5. Has the plan satisfied the 401(k) ADP                         11.Were top-heavy minimum contributions
and ACP nondiscrimination tests?                                 made?
Most 401(k) plans must satisfy yearly ADP/ACP                    If the plan is top-heavy, minimum contributions for non-key  
nondiscrimination tests.                                         employees are required.   
(More)                                                           (More)

6.Were all eligible employees identified                         12.Was Form 5500 filed?
and given the opportunity to make an                             Many 401(k) plans must make an annual filing with   
elective deferral?                                               the Federal government.   
By supplying your tax advisor with information regarding all     (More) 
employees who receive a Form W-2, you may reduce the risk  
of omitting eligible employees.  
(More) 

If you answered “No” to any of the above questions, you may have made a mistake in the oper­
ation of your 401(k) plan. This list is only a guide to a more compliant plan, so answering “Yes” to each question  
may not mean your plan is 100% compliant. Many mistakes can be corrected easily, without penalty and without  
notifying the IRS.  
■  contact your tax advisor                           ■ www.irs.gov/retirement             ■  call the IRS at 877-829-5500
           Publication 4531 (Rev. 8-2018) Catalog Number 48552T Department of the Treasury Internal Revenue Service www.irs.gov