Old Job 401(k) & 401(k) Discrimination Testing

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jackb1117
Posts: 43
Joined: Tue Mar 19, 2019 1:47 pm

Old Job 401(k) & 401(k) Discrimination Testing

Post by jackb1117 »

Each time I have changed jobs in the past I have almost immediately rolled my 401k into an IRA or left it with the employer if the plan was low-cost / had the fund options I wanted.

Recently, I started a new job and do not want to leave my old 401(k) balance with the old 401k provider (high fees, poor offering / services, etc.), and as such would like to move it to Fidelity or Vanguard ASAP. However, I was considered a Highly Compensated Employee at this organization and we failed the IRS discrimination test each year (5+) I was employed there, so each year a check was cut to refund some of my contributions.

I am curious if anyone has been through this before; my old HR team informed me that they won't know if they failed the discrimination test (they will) until EOM March. If I move my balance before this happens, am I creating a headache for myself? My preference would be to move my balance ASAP, but can wait a few months to save myself a paperwork nightmare. Thanks in advance!
Soon2BXProgrammer
Posts: 1608
Joined: Mon Nov 24, 2014 11:30 pm

Re: Old Job 401(k) & 401(k) Discrimination Testing

Post by Soon2BXProgrammer »

I'd suggest waiting, it is much easier if you don't move it.
retiredjg
Posts: 42754
Joined: Thu Jan 10, 2008 12:56 pm

Re: Old Job 401(k) & 401(k) Discrimination Testing

Post by retiredjg »

I'd wait.
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Nate79
Posts: 6724
Joined: Thu Aug 11, 2016 6:24 pm
Location: Delaware

Re: Old Job 401(k) & 401(k) Discrimination Testing

Post by Nate79 »

Definately wait.
Spirit Rider
Posts: 13910
Joined: Fri Mar 02, 2007 2:39 pm

Re: Old Job 401(k) & 401(k) Discrimination Testing

Post by Spirit Rider »

Excess 401k contributions due to ADP failure are returned my 3/15.
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