FAQ 675: ADP--Recharacterizing ADP failures to after-tax


I've got another client who wants us to illustrate how to correct a failed ADP test by recharacterizing failures to after-tax. I know this seems obscure, but we obviously have a rogue relationship manager who thinks this is the best way to help them. Any thoughts on a non-manual way to accomplish this in ASC? I assume the first step is to determine ADP failures by running the test, next reduce the employees' deferrals by their failure and add to ACP test as after-tax, then re-run the test. Of course, this will probably cause an ACP failure, but we need to see it.


I don't know of a more efficient way to do it than what you've outlined here. I think you're right on target. We don't have a "reclass to after-tax" correction option. It is on our programmers' project list, but I don't know what priority it will ever be given since it is rarely used.