Employee Retirement Contributions Not Made?

[Eremis77]

What is the name of your state (only U.S. law)? California

Hello. When I was hired by my current employer, my offer letter stated that the employer would contribute into a Simple IRA account at the rate of 2% of my salary, completely independent from my payroll. (No contribution is required of me, but I can add to it if I want.)

The problem is, it's been seven months since I was hired and there is no evidence that anything has been deposited. I have received no confirmation or statements from the financial company. (I was actually asked about a month after my hire to give my boss another copy of the paperwork, because she had forgotten to submit it at that point.) I asked a coworker about it, and she said they are also far behind on payments for her account.

What options do I have to get this taken care of that hopefully won't anger my boss? (I DO like my job for a change, so don't want to tick people off just yet, but at the same time I do want what was promised to me upon hire.) Can I request that any back payments that should have been made be deposited now?

 

[davew128]

You don't have any idea how these things work. Every retirement plan I've ever dealt with, including SIMPLE's has the employer making their contribution after the end of the calendar year and under tax law has until the extended due date of THEIR tax return to do it. If you were expecting regular contributions, you were sorely mistaken.

 

[Beth3]

my offer letter stated that the employer would contribute into a Simple IRA account at the rate of 2% of my salary,

Starting when? It's pretty customary for employers not to begin contributing to an employee's retirement plan until after the employee has worked for them for at least 12 months.

 

[Eremis77]

@davew128 - Thank you for the info, but the insulting tone was a bit unnecessary, wasn't it? This may be the case with this employer, but with the added info from my coworker that they're behind on HER contributions by about 3 years now, I though it was important to research this now, before they get that far behind.

@Beth3 - These contributions are supposed to start immediately - or, rather, if davew128 is correct, start at the end of the year, but be based on my income from my hire date forward. (It's a smaller company, so they don't have the waiting period that I've experienced with larger corporations.)

 

[davew128]

Sorry, let me hold your hand and tell you that you have no idea what you're talking about.

The point here is that a 2% non-elective SIMPLE plan contribution is not required by law to be made by the employer until the extended due date of the employers tax return. PERIOD.

That said, if you've received written plan documents from an active SIMPLE plan, your colleague should be contacting the IRS/DOL about non-payment of matching contributions. You have no loss at this point.