There are good third-party administrators (TPAs) and bad ones. No matter how good your TPA is, they’re not a mind reader. So when it comes to providing information to your TPA, you need to level with them. If you don’t provide the necessary information about the census, ownership, ownership in other entities, and other qualified plans you maintain, your TPA can’t do its job credibly.
I’ve seen clients not tell the TPA that they have additional retirement plans or additional companies, which can be catastrophic.
I’ve seen too many TPAs discover errors, just because the plan sponsor didn’t provide the necessary information. Corrective contributions might be owed if you did the employee census incorrectly or if you didn’t provide all the companies you own.
The easiest errors to avoid are the ones you can avoid by providing the information your TPA asks and by volunteering information that you think they should know.
