FAQ 827: ADP: QNEC - Prior year testing

Problem: A plan has failed the ADP test for the 2007 plan year. It is tested using prior year results. The distributions did not take place by 12/31/08. We have two options. One is the one to one correction method or two is A QNEC. How do we get the results we need regarding a QNEC contribution when the plan uses prior year testing?

Solution: The system cannot do a prior year QNEC it was never programmed since a QNEC's dollar amount should be deposited within 12 months of the plan year end. If you wanted to do one you will have to do it outside the system.