Avoid Common Errors When Scheduling Payments for Defined Contribution Plans
Each pay period, employers schedule contribution payments with ICMA-RC, the third-party administrator for VRS defined contribution plans (DCP). Submitting contributions in a timely manner ensures that funds are invested for the member's benefit.
If contributions are delayed, an employee's investment earnings may be impacted and the employer may be assessed penalties.
To avoid delays, be aware of these common – and preventable – errors:
- Submitting an ACH credit or wire that does not match the total amount in the contribution file.
- Including a negative contribution in a file to correct an erroneous amount that posted more than 14 business days earlier, and/or not depositing enough funds in the employee's account to cover the negative amounts.
- Not including required data fields in the contribution file.
In addition to a careful self-check of your contribution file each pay period, consider these additional tools available to you.
Submit contributions quickly using a batch file: Contributions are submitted via EZLink by either uploading a batch file or manually entering each employee's contribution amounts to create a file. A batch file provides you with a quick solution for submitting multiple contributions at once.
To learn more about how you can implement this time-saving process, contact ICMA-RC's Employer Support Team at 877-327-5261 (option 3).
Use ACH debit to make payments: By using ACH debit, you will not incur a wire fee or need to initiate payments. ICMA-RC will initiate the payment process on your behalf once the contribution file is successfully submitted in EZLink.
If you are interested in switching payment methods, fill out the ACH Debit Authorization Form . Wire and ACH credit options are also available, for more information review the payroll page on the Hybrid Resource Center for Employers.
Important: When paying contributions via ACH credit and wire, always include the VRS plan number and your five-digit employer code (ICMA-RC calls this your “division code”) on the instructions. Otherwise, the payroll contributions could be delayed. If you use a third-party payroll administrator, please share this essential information to ensure successful contribution submissions on your behalf.