Hi,

Question regarding auto enrollments, if participant is auto enrolled and then opts out and receives distribution, I am assuming that they are considered as 'to never have deferred' for ADP purposes, so they are zero for tests?

Also, since it was auto enrolled, then opted out, a contribution will show going into/ out of trust. How is this reflected on the 5500? Do they negate one another and therefore not shown as a contribution or as benefit paid?

Thanks,

Jasofk

Yes, they would be zeroes for ADP purposes. (The regs specifically exclude the amounts deferred and subsequently returned from being included in the ADP test: Treas. Reg. Section 1.401(k)-2(a)(5)(vi).)

I don't do Forms 5500 (or windows), but this type of withdrawal is a distribution for which a Form 1099-R would have to be issued (using Distribution Code 2--see Instructions), so I would think that the Form 5500 would show the amount both as going in and as coming out (technical terms!!).