For timely deposits, employers have until “no later than 15 business days after the month in which the payroll deduction occurred” before making deposits into the plan would be considered late. In this case, the burden of proof is on the employer to show why the deposit up to this point is “timely.” However, there is a “safe harbor” time period the DOL came out with in 2010 that is “7 business days following the payroll deduction date.” This means there is no burden of proof. This “safe harbor” only applies to small plans (generally those with fewer than 100 participants). For large plans, best practice is to deposit them as soon as possible, preferably on the pay date. Actually, this is the best practice for all plan sponsors to follow!

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