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401k Audit Thresholds

Most growing Company's maybe unaware that with growth comes additional requirements for an audit of your 401k Plan. As Company's eligible plan participant levels at the beginning of the plan year exceed the 100 mark, the DOL requires an audit to be attached to the Form 5500 filing in order to comply with the DOL regulations. There is however a rule termed the 80-120 rule which permits plans with participants between the 80 to 120 mark to file the same way as they did in the previous year. So for example, if your eligible plan participant count reaches 110 at the beginning of the plan year but filed as a small plan in the previous year, your Plan is still eligible to file as a small plan and hence not require an audited statement to be attached. This rule is however only applicable to the first year and therefore in the next year if the plan maintains its eligible participant count at 110, an audit would be required.


At Synergy Accounting, we are experts in 401k Plan audits and have worked with a variety of 401k Plan providers in meeting client needs. Contact us if you have reached that magic threshold number and let us take care of your audit needs seamlessly.

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