![](https://investmentwithinsight.com/wp-content/uploads/2023/11/compliance-testing-300x111.jpeg)
Understanding Compliance Testing for 401(k) Plan Sponsors
Compliance testing is a crucial annual responsibility for 401(k) plan sponsors, mandated by the Internal Revenue Service (IRS). It ensures that a company’s 401(k) plan remains equitable, not favoring owners and highly compensated employees (HCEs), and stays within IRS-prescribed limits.