Not a lawyer, but get a hold of the Summary Plan Documents (SPD) for the last few years. This will show what the company was supposed to do. If they’re missing or they won’t provide them, it could help your case.
Your tax accountant wouldn’t know about this unless it was on your statements. It’s not something they’d ask for.
I had a similar situation. A while after I left a company, I got a notice about a deposit. They had to backfill contributions and theoretical earnings after failing a compliance test.
You’re right, they should cover lost earnings, not just the contributions. They may already plan to, but it’s worth double-checking. You might not need a lawyer yet, but keep everything in writing. If they make it difficult, consider legal advice.
You may not need a lawyer. Contact the Employee Benefits Security Administration at the Department of Labor. They can audit the company’s 401k, and non-compliance fines could motivate the company to act.
They likely owe you for both the missed contributions and lost earnings. If they don’t agree, a lawyer may help. Best of luck.
Look on the bright side—you’re not my coworker who thought they were in the 401k plan for 6 years, only to find out they weren’t.
You should check your statements monthly to keep track of your investments.
Your accountant wouldn’t have known about this since 401k contributions usually have no tax impact until retirement. Missing those contributions over two years probably cost you a lot in growth though.
If they’re not being cooperative, consider contacting an ERISA attorney for guidance. They specialize in employee benefits and could ensure you’re properly compensated.
Did they give you a reason for not matching the contributions? Did they tell you they’d be matching when you started?
If your company has over 100 employees, they’re supposed to do an audit of the plan each year. If they missed this, they’re out of compliance on multiple fronts.
It’s easy to miss things like this. I track every pay statement with a spreadsheet and use Quicken for record-keeping. Your tax accountant wouldn’t have known about the match.
Would they calculate lost earnings based only on index funds, or would high-gain stocks like NVIDIA be considered?
Teal said:
Would they calculate lost earnings based only on index funds, or would high-gain stocks like NVIDIA be considered?
Usually, you can’t pick individual stocks in a 401k, just funds. They’d calculate based on your actual investment choices.
Have you been contributing regularly? Make sure your funds aren’t just sitting in cash within the plan. Check the plan documents for next steps.
Hartley said:
Have you been contributing regularly? Make sure your funds aren’t just sitting in cash within the plan. Check the plan documents for next steps.
Thanks! I’ve been contributing 8%, and my rate of return has been 20%, so it looks like it’s invested.