Thank you again for your reply. I realize as I write this the general assumption could be the contribution is part of a regular payment. It is not, it is a lump sum catch up contribution. I should have put that in the question title and description.
The business is an LLC partnership. As part of that each of the partners receive guaranteed payments. I withhold contributing until the 4th quarter and then direct finance to make a lump sum catch up contribution to a simple 401k plan. In the strict sense the payment shows up in the books as a guaranteed payment. The payments are not part of regular withholding. The plan is a qualified plan and does allow lump sum contributions.
The argument as I understand it is because the payment is entered as a guaranteed payment there is no journal entry to cause his process to recognize it as a 401k contribution.
Is there a form to record lump sum contributions.
