DOL Clarifies Timing of Deposit of Elective Deferrals into Plan (Posted July 8, 2000) Technical Tip 1: The following question and answer were from the DOL Q&A Session at the 1999 ASPPA Annual Conference: Please clarify the timing of employer transmission of elective deferrals. Employer ABC sends its deposit information to the investment company electronically and writes out a check for the amount of the deposit at the same time. However, the employer holds the check until the employer receives a call back from the investment company letting the employer know whether or not the deposit information was in order. We have told employer ABC that the check should be mailed at the same time the deposit information is electronically transmitted to the Investment Company. What is your opinion on this? DOL Response: The employer needs to deposit the money as soon as it can be segregated and the employer should not hold the check. It is recognized that reconciliation of payroll data is part of the period permitted under the regulations during which the contributions cannot yet be segregated. It is further recognized there will be some reconciliation that will need to be done by the recordkeeper, but the cash should be put in the plan during this period and not held out of the plan or held uncashed as a check. View all Tips © 2000-2012 Reish Luftman Reicher & Cohen, a Professional Corporation Important notice: Answers are provided as general guidance on the subjects covered in the question and are not provided as legal advice to the questioner's situation. Any legal issues should be reviewed by your legal counsel to apply the law to the particular facts of your situation.